Long-term asset funds (LTAFs) offer access to illiquid private assets with potential for high returns. The UK market currently has over 20 strategies, with assets under management totaling around £5 billion and about £3 billion in committed capital. Large asset managers like Schroders and BlackRock dominate the market.

Chancellor Rachel Reeves announced that from April 2026, LTAFs can be included in stocks and shares ISAs, potentially unlocking retail market access and boosting AUM growth. LTAFs offer diversification benefits with access to private equity, debt, infrastructure, and more, providing high absolute returns historically.

Investors must carefully evaluate LTAFs, considering factors like liquidity tools, fees, valuation, transparency, and expertise. Advisors play a crucial role in educating clients and aiding in due diligence. Platform availability remains a challenge, but progress is expected with LTAFs becoming accessible through ISAs.

Read more at Morningstar: LTAFs Will Get an ISA Boost, but New Investors Should Do Their Homework