Our research explores the UK's alternative investment fund (AIF) market using our regulatory data.
This research looks at the UK AIF market, how it has changed over time and how risks and vulnerabilities are distributed across the market.
The UK AIF market has grown significantly, with the value of funds managed in the UK reaching £1.8tn in 2025. Growth in funds marketed in the UK has been broadly spread across fund types, although private credit has emerged as one of the fastest growing segments of the market.
The findings have informed our proposals to modernise the UK Alternative Investment Fund Managers Directive (AIFMD)[3].
The findings provide a snapshot of the market before our proposed regulatory reforms, setting a baseline to help us evaluate future regulatory changes.
Our other key findings include:
- Professional investors remain at the centre of the market.
- Leverage and liquidity risks are concentrated in certain fund types rather than widespread across the market.
- The AIF sector is characterised by specialist firms operating alongside a relatively small number of very large managers.
The analysis draws on data that fund managers report to us under the AIFMD. It covers all AIFs available to UK investors between 2021 and 2025. When looking at UK-managed AIFs, coverage goes back to 2016.
It's the first FCA publication to use regulatory data to build a market-wide picture of this sector. Public data on this market has been limited until now.
Authors
Rachel Ennis, Fabian Garavito, Silvia Lozano Guerrero and Forhad Tanvir.
(The analysis also draws on previous work by colleagues across the FCA, including Daniel Abreu, Sarah Alexander, Yordan Georgiev and Martin Edwards.)
Disclaimer
Research contributes to the work of the FCA by providing rigorous research results and stimulating debate. While it may not necessarily represent the position of the FCA, it is one source of evidence that the FCA may use while discharging its functions and to inform its views. The FCA endeavours to ensure that research outputs are correct through checks, including independent referee reports, but the nature of such research and choice of research methods is a matter for the authors using their expert judgement. This paper is provided for general information only. The FCA does not guarantee the accuracy, completeness, or reliability of this paper. The FCA accepts no responsibility for any errors or omissions in this paper, any loss or damage arising from reliance on this paper, or for any action taken based on the information provided.