Strong demand from wealth management clients for better access to alternative assets and private markets provided the impetus for the company to start the new division in order to better serve the growing appetite for these products and strategies, it said.
Chief fund groups officer at Allfunds Borja Largo said: "It was essential for us to have a team dedicated exclusively to alternative assets."
Largo added Allfunds was in a good position to understand the requirements and preferences of both general partners and distributors of illiquid strategies.
Bond resurgence sparks rethink of alternatives in multi-asset portfolios
Allfunds chief executive Juan Alcaraz added: "This is another step in our ongoing effort to have the best value proposition in the market and to enhance our one-stop shop model, covering all our customers' needs in a single point of access.
"We have been developing our alternative offering for some time and believe that with the combination of our experience, human capital and technology, we are perfectly positioned to capitalise on these opportunities".
The launch of a new category of open-ended authorised funds, known as the Long-Term Asset Fund by the Financial Conduct Authority in October 2021 is an important driver in the increased demand for alternative assets such as private equity and debt as well as infrastructure and real estate, according to commentators.
The first LTAF fund was authorised by the regulator earlier this month.