The Reds, Juventus and Inter Milan are the three leading protagonists to sign the talented 21-year-old on a temporary basis when the winner market opens.
The report suggests that the Reds would be unlikely to agree to the loan unless there was an option to buy the 18-cap Portugal ace next summer.
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Signing a player of Felix’s quality on loan would be a surprising but sensational piece of business from the Anfield club.
Predominantly operating as a false nine in a well blessed Atletico squad, Felix could be the ideal long-term replacement for Roberto Firmino.
Valued at £72million and under contract until 2026 (Transfermarkt), landing the star on a permanent basis would prove an expensive outlay.
Whether the Spanish club would be willing to offer one of their brightest young talents directly to a UEFA Champions League rival remains to be seen.