Fidelity International is planning to launch a multi-credit European Long Term Investment Fund (ELTIF), to broaden access to its private assets to a wider investor demographic.
The investment firm registered its first ELTIF in Luxembourg (pictured) last month, according to a legal entity register cited by Ignites.
Fidelity said that it is exploring options to broaden access to its private assets business and is aiming to update clients with further information in the coming months.
“Traditionally, private assets like private equity or private credit, have only been accessible to large institutional investors,” a Fidelity spokesperson said.
“Yet a growing, and broader, profile of investors are joining the structural trend to add and increase private assets allocations within their portfolios, and we expect this to expand further over time. We are committed to building a broad private assets business across a wide range of capability areas, including exploring options to provide access via an ELTIF.
“We hope to broaden the asset class to a wider investor demographic, utilising our established and deep relationships with distributors right across Europe.”
The second iteration of the ELTIF regulations came into force on 10 January 2024, dubbed ELTIF 2.0.
They are designed to encourage private investors to put money into long-term, illiquid assets, including credit, which were typically the preserve of institutional investors.
A number of firms have already launched ELTIFs, including M&G and Apollo, with many more applications still in the pipeline.
Silke Bernard, global head of investment funds practice, Luxembourg at law firm Linklaters, told Alternative Credit Investor last month that “ELTIF 2.0 is creating a lot of appetite”, adding that she knows of around 40 structures in the pipeline at the moment.
“I think there are very interesting opportunities for ELTIFs in the credit space,” said Bernard. “ELTIFs have been made more flexible now, compared to the first iteration of the rules which were stringent in terms of leverage and currency matching. Quite a few of these rules have gone away. Fintech start-ups within their first five years of authorisation are now eligible assets for funds following a credit strategy, whereas before there was a prohibition.”