The investment manager is the first to receive regulatory approval in the UK for this type of fund.
Schroders has announced that it has received regulatory approval from the UK’s Financial Conduct Authority to launch the first long-term asset fund.
LTAFs are regulated open-ended investment vehicles designed to enable a broader range of investors, with longer-term horizons, to invest efficiently in illiquid and private assets.
Schroders said that it already provides greater access to private assets through its range of listed vehicles, as well as semi-liquid and illiquid structures. Following recent regulatory approval to launch an LTAF in the UK, Schroders Capital – the private assets division of Schroders – said it will focus on providing defined contribution and other eligible investors to access the breadth of its private asset investment capabilities.
In future, LTAFs may also have a role to play in the UK wealth market, subject to the outcome of the ongoing FCA consultation on broadening access to long-term asset funds, the firm continued.
Peter Harrison, group chief executive at Schroders, said: “We feel strongly that a wider range of UK savers must be able to take advantage of the robust returns and diversification benefits that investing in private assets can bring.
“There are some great industries and firms which could be further supported by long-term capital. The LTAF structure is designed to address this and I am delighted that the imminent launch of Schroders' first LTAF, which is the first to be approved in the UK, will enable these companies to start benefiting from big pools of long-term capital and, in turn, help long-term savers,” he continued.
Tim Horne, head of UK institutional DC at Schroders, added: “Private assets have the potential to help DC investors achieve their aims of a good outcome in retirement. The LTAF regime has been specifically designed to provide a regulated fund structure that provides a framework to invest into these assets.”