Will the FCA's plans to fix open-ended property funds work?

Mark Carney, the former governor of the Bank of England, famously said open-ended funds which invest in illiquid assets are "built on a lie". This has been particularly evident with property funds, which have been forced to open and close themselves to redemptions repeatedly over the past few years, first in response to Brexit and then because of the coronavirus pandemic.

To fix this this the Financial Conduct Authority has proposed a new type of fund: the long-term asset fund, which have "liquidity tools" which could include notice periods, deferred redemptions or limits on the amount of a fund which can be redeemed during a set period.

This week FTAdviser digital editor Damian Fantato is joined by Ryan Hughes, head of active portfolios at AJ Bell, and Mike Barrett, consulting director at The Lang Cat, to discuss what these new funds could mean for advisers, platforms and discretionary fund managers.

They also examine how this fund could work in practice and how it could fit into existing distribution channels, what this means for property as an asset and whether the FCA's attempts to square the liquidity circle are in vain.

The FTAdviser Podcast is the weekly podcast for financial advisers, brought to you by FTAdviser. Each week, FTAdviser is joined by guests from the industry to discuss the week in news and pressing industry issues.

Hosted on Acast. See acast.com/privacy for more information.