BlackRock, the world’s largest asset manager, has been granted approval by the Financial Conduct Authority (FCA) to launch a Long-Term Asset Fund (LTAF).
Given the regulatory greenlight in October 2021, 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.
While the investment vehicles are currently only available to DC clients, they may have a role to play in the UK wealth market, subject to the outcome of the ongoing FCA consultation on broadening access to retail investors.
BlackRock said its Diversified Alternative Strategies LTAF will supplement the firm’s range of defined contribution (DC) retirement solutions by blending multiple private market asset classes, such as infrastructure, private credit, private equity and real estate.
BlackRock manages over £176bn on behalf of DC clients in the UK.
BlackRock follows in the footsteps of Schroders, which was the first to be granted regulatory approval for the investment vehicles, and Aviva Investors, which launched a £1.5bn LTAF at the start of May.
Sarah Melvin, head of UK at BlackRock, said: “Today marks an important milestone in expanding the investment opportunities for UK DC members with the singular goal of delivering better investment outcomes for the millions of people saving for their retirement through a DC scheme.
“Savers across the country face several challenges to meet their long-term savings goals. Our Diversified Alternatives Strategy can provide the risk-adjusted returns investors need to meet their retirement aspirations and make it simpler for them to access a range of private markets strategies through one fund.”