PRIVATE MARKETS
RISK WARNINGS

Introduction - for LTAFs

Estimated reading time: 2 min
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Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.

What are the key risks?

1. You should be ready to invest for the long term and, during this time, the value of your investment may go up or down. You may lose money on your investment.

• Assets in this fund may take a long time to buy and sell.
• Long-Term Asset Funds (LTAFs) can invest into fixed assets, infrastructure, or complex financial products, all of which are relatively hard to sell. Investors who do not remain invested for the long-term may not get back all of their money. It may take many years to make a profit on the investment.
• You should carry out your own research, so that you understand what you are investing in.

2. If you decide to exit early, you won’t get your money back quickly

• This LTAF accepts requests to sell units only once a month and there is also a 90-day waiting period before the value of your units is determined and you receive your money. This means that:
• If you choose to sell your units on 2 January, and the trading day is the 15th of the month, you won’t get any money back until approximately 20 April, assuming a few extra days for the trade to close and funds to transfer.
• The value of the units you sell will be at the price set on 15 April if it is a business day, or else the next business day after it.
• Once your redemption request has been approved, you cannot cancel your request.

3. It will take a long time to make profits

• If the assets the LTAF invests in are successful, it may still take a long time to get your money back and make a profit.
• You should not expect to get your money back as payments of income (unless the LTAF includes payments of income as an investment objective)

4. Don’t put all your eggs in one basket

• Putting all your money into a single investment or type of investment is risky. Spreading your money across different investments makes you less dependent on any one to do well.
• A good rule of thumb is not to invest more than 10% of your money in high-risk investments.

5. You are unlikely to be protected if something goes wrong

• Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Learn more about FSCS protection here.
• Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated platform, FOS may be able to consider it. Learn more about FOS protection here.