Traditional Funds vs. ELTIFs: How Do They Fit Together?

In short: Traditional funds (UCITS/OGAW) are liquid, publicly traded funds subject to strict regulation. ELTIFs—European Long-Term Investment Funds—invest in illiquid assets such as private companies and infrastructure, with the goal of achieving long-term growth potential. Most well-balanced portfolios use both—for different purposes.

Both traditional funds and ELTIFs play a role in a well-balanced portfolio—but they serve different purposes.

Traditional Funds: Liquidity and Flexibility

Traditional funds are built for diversification and flexible strategies. They remain an important part of Moniflo's offering, giving investors liquidity and flexibility.

ELTIFs: Long-Term Growth with Insight into Potential Returns

ELTIFs are designed for long-term holdings. Each fund’s Key Information Document (KID) includes return scenarios—ranging from stress scenarios to favorable scenarios—thereby providing investors with greater insight into a range of possible outcomes, none of which are guaranteed.

Together, a more diversified portfolio

Use traditional funds for balance and liquidity. Use ELTIFs for depth and long-term growth potential.

On Moniflo, you can manage both in one place—with ELTIFs as a new option for long-term, high-quality investing.

FAQ

Q: What are the core structural differences between traditional funds and private market funds?

‍A: Traditional funds are open-ended, liquid, invest in publicly traded securities, and follow strict diversification rules. ELTIFs are typically closed-ended or semi-liquid, invest in illiquid assets, and have longer investment horizons.

Q: Can ELTIFs completely replace traditional funds?

‍A: No—they serve different purposes. Traditional funds offer liquidity and flexibility; ELTIFs provide access to different assets and different return potential, albeit with lower liquidity. Together, they can complement each other.

Q: What is the risk-return ratio between traditional funds and ELTIFs?

‍A: ELTIFs tend to offer higher potential returns in exchange for lower liquidity and longer holding periods. Traditional funds offer greater liquidity but less access to private-market assets.

Q: How does Moniflo support managing both fund types?

‍A: Moniflo offers both types of products in its portfolio, enabling investors to use traditional funds for liquidity and ELTIFs for long-term positions side by side.

Q: Are traditional funds and ELTIFs treated differently under regulatory guidelines?

‍A: Yes. ELTIFs are regulated under the AIFMD/ELTIF frameworks, which include additional, structure-specific rules, while traditional funds follow the rules of the UCITS Directive, which are designed to promote liquidity.

Investments in ELTIFs are long-term in nature and have limited liquidity, subject to specific redemption terms. They are not suitable for all investors. Please review all fund documents carefully before investing. Your capital is at risk. This is a marketing communication.