Fidelity International has received regulatory approval from the Financial Conduct Authority (FCA) to launch its first Long-Term Asset Fund (LTAF), the Fidelity Diversified Private Assets LTAF.
It will invest in private equity, private credit, infrastructure, real estate and natural resources, giving investors access to the diverse world of both private and public assets.
Fidelity said the fund has been developed for clients seeking private assets for defined contribution (DC) pension schemes, giving them access to multiple asset classes and investment opportunities.
Henk-Jan Rikkerink, global head of solutions and multi assets at the firm, said: “Today, a number of clients are already asking to include private assets in their solutions, and we only expect this to grow over the coming years.”
In the future, Rikkerink believes LTAFs will continue to become more attractive, as clients begin to look for “a wider range of options to meet their long-term investment objectives” outside of traditional asset classes.
Following FCA regulation changes in 2021, the LTAF structure aims to protect investors from emergency exits, by giving the fund up to 90 days to pay out investors. This differs from the more traditional open-ended fund structure which deals daily.
As a result, LTAF’s aim is to avoid ‘gating’, where a fund closes temporarily while attempting to pay back investors pulling their money out of the fund.
With the launch of the Diversified Private Asset LTAF, Fidelity joins the list of providers with approved LTAF solutions such as L&G and Schroders, among others.