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The FIA in Luxembourg: Alternative Investment Funds

1 month ago #Event

The Futures Industry Association, or the FIA, is growing in Luxembourg. According to Paperjam, of the 4.411 billion euros in assets held in Luxembourg funds, more than 757 billion euros come from alternative investment funds. There is a wealth of investment opportunities; how can Luxembourg take advantage of them?

When legislation came into place for investments in Luxembourg, there was an abundance of alternative investment funds. Luxembourg offers many different choices. Let’s take a look at three different options to compare.

SICAR

SICAR is specifically for venture capital investments and is reserved for sophisticated investors.  It is subject to supervision by the CSSF (Commission de Surveillance du Secteur Financier) in Luxembourg. The SICAR is a good choice for venture capital investors as they can directly benefit from the favourable tax system and more flexible regulation in terms of risk concentration specifically.

FIS

FIS investments are also reserved for sophisticated investors but they are not a vehicle for a specific type of investment like the SICAR. It was created on the basis of opening funds to a broader panel of investors to increase opportunity. The plan worked well and the FIS reached more than 558 billion euros in assets as of today. FIS investments can be used for many different types of strategies, but there has been an increase in investment funds specifically for real estate and private equity.

FIAR

FIAR, another investment fund in Luxembourg, is not subject to supervision by the CSSF but is supervised by an alternative investment fund manager. FIAR is just as flexible as the FIS and SICAR and was an immediate success when it was first created. The number of FIARs increased by 169% and assets under management increased by 158% since then.

What to choose?

In conclusion, there are a few different options available for investing in Luxembourg. When doing your own research, you should consider whether you’d rather go the regulated or unregulated route (like FIAR, not directly subject to CSSF approval but still has a manager). Luxembourg offers many different options – be sure to do your research to have all of the facts!

 

Source: paperjam.lu