Capital Growth Future debuts two Long-Term Asset Funds (LTAFs)
Future Growth Capital (FGC), a private markets investment business established by Phoenix Group and Schroders, has announced the launch of two new long-term asset funds (LTAFs). These funds aim to support the government's Mansion House objectives, boosting retirement savings for UK pension savers while unlocking long-term finance to fuel UK growth.
The global strategy fund will invest in securities across the world, focusing on companies positioned to benefit from megatrends, emphasizing innovation and secular change. It operates with a commitment to proprietary fundamental research and aims for long-term growth by identifying undervalued equity opportunities worldwide.
On the other hand, the UK strategy fund will leverage deep regional experience, as seen in FGC's investments in South Africa, to focus on developmental equity and actively involve in early-stage businesses.
Both funds emphasize investments in innovation-driven companies, particularly small- and mid-cap firms with potential to disrupt markets and capitalize on emerging trends. They pursue long-term asset growth through active management and fundamental research backed by a thematic investment philosophy.
The target investment return after fees per annum for both funds is 10%. The UK LTAF provides an efficient way to balance and diversify public market portfolios, as 36% of the UK's 500 largest companies are privately held.
Ped Phrompechrut, chief investment officer of FGC, stated that private markets are essential building blocks to deliver better pension outcomes. FGC aims to deploy £10-20bn over the next decade into private markets, with Phoenix Group intending to invest five per cent of its relevant savings products on behalf of its policyholders via investment products managed or advised by FGC.
The two LTAFs, approved by the Financial Conduct Authority in October 2024, will offer actively-managed, diversified private markets exposure to private equity and venture capital, real assets, and private debt. Both funds will participate in the UK's energy transition, with £900bn of investment in energy infrastructure needed for the UK to meet its energy transition goals.
The global LTAF will provide exposure to assets from private markets in the US, Europe, and Asia. Paul Forshaw, the chief executive of FGC, will oversee the operations of the new funds.
With the UK being a hub of innovation, the third largest venture capital market in the world, and the leading supplier of unicorn businesses in Europe, these funds present an exciting opportunity for investors to participate in the UK's growth and energy transition.
[1] Future Growth Capital website [4] South African development equity fund information [5] FGC ETFs focused on small- and mid-cap companies with innovation potential
- These new long-term asset funds established by Future Growth Capital, such as the global strategy fund and the UK strategy fund, focus on investing in companies that are innovation-driven, particularly small- and mid-cap firms with the potential to disrupt markets and capitalize on emerging trends.
- The UK strategy fund, managed by Future Growth Capital, will utilize deep regional experience, as seen in their investments in South Africa, to focus on developmental equity and actively engage with early-stage businesses, ultimately providing an efficient way for investors to participate in the UK's growth and energy transition.
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