Individual investors will soon be able to gain exposure to a natural resources fund run by private equity firm Apollo Global Management, reports indicate. The asset manager plans to raise $3 billion in capital for the portfolio, dubbed Apollo Natural Resources II, which is designed to opportunistically invest across energy, mining and agriculture amid a weak commodity price environment.

 

Apollo’s decision to open up the fund to retail investors is part of a broader trend by alternative asset managers including private equity and hedge funds to target qualified individual investors who are comfortable with a higher risk/reward profile.

 

Structurally, retail investors can gain exposure to the portfolio by investing in feeder fund Apollo Natural Resources II ASP Fund with Wells Fargo, which will in turn invest that capital into Apollo Natural Resources II. Wells Fargo’s investment forecast calls for improving commodity prices.

 

The minimum investment for wealthy individuals is $100,000 compared to the typical threshold for alternative fund investing of more than $1 million. Apollo has so far raised about $7 million for the feeder fund, reports suggest.

 

Apollo will allocate between $100 million and $300 million for each of the fund’s investments and will also focus on the opportunity to extend credit to beleaguered oil and gas exploration and production companies that are saddled with debt and don’t have access to traditional bank financing.

 

Apollo Natural Resources II is the second of the firm’s portfolios dedicated to natural resources. The firm’s maiden natural resources fund, dubbed ANRP I, was launched with $1.3 billion in assets under management and had a gross IRR of 15.8 percent as of the end of the first quarter.