Bringing you live news and features since 2006 

Survey

UK investors are underweight in venture capital, say IFAs

RELATED TOPICS​

The majority (50 per cent) of UK independent financial advisers (IFAs) believe sophisticated investors are underweight in the venture capital sector, according to research by venture capital investor Albion Ventures.

IFAs estimate that less than a fifth (17 per cent) of their clients’ currently have direct exposure to venture capital, with most of those surveyed (48 per cent) believing that their clients’ exposure to venture capital will increase in the next five years.
 
Just three per cent expect a decrease. Only a handful of IFAs (2.2 per cent) believe their clients are overweight in the sector.
 
Sophisticated investors can access the venture capital sector through venture capital trusts (VCTs), investment companies listed on the London Stock Exchange. VCTs provide investment for smaller companies and offer investors a range of incentives including 30 per cent income tax relief, tax free dividends and no tax on capital gains. VCTs have continued to grow in popularity in recent years. In 2012-13 GBP370m of funds were raised by VCTs, GBP45m more than 2011-12.
 
Patrick Reeve, managing partner of Albion Ventures says: “IFAs recognise there is currently an investment gap in the UK venture capital sector. Most investors are not realising the potential benefits of investing through VCTs.
 
“Financial advisers need to explore alternative tax efficient methods to help their clients build up a suitably sized nest egg. VCTs are a great option offering investors significant tax incentives and long-term capital growth. Investors in VCTs also benefit in the knowledge they are helping small firms grow and are supporting the wider UK economy.”
 
The research follows the launch of Albion VCTs Top Up Offers, which are seeking to raise up to GBP15m across its six venture capital trusts. The offers are targeting a monthly tax-free income of five per cent (should investors choose to invest equally across all offers), equivalent to 7.1 per cent on the net cost of investment after up-front tax relief at 30 per cent. Investors in the offers also have the option to boost their capital growth by participating in the dividend reinvestment scheme (DRIS), under which dividends are reinvested in the form of new shares in Albion VCTs.

Latest News

Figment Europe, a provider of institutional staking infrastructure, writes that it is solidifying its presence in the heart of Europe’s..
Saving and investing app, Moneybox, has doubled the number of ETFs available on the platform, in the light of ‘growing..
Global X ETFs has announced the appointment of Ryan O'Connor as its Chief Executive Officer effective as of April 8, 2024. ..
Value-driven structured credit investing firm, Angel Oak Capital Advisors, LLC, has announced the completed conversions of two of its mutual..

Related Articles

Jigna Gibb, Bloomberg
Bloomberg Indices has recently hired Jigna Gibb as Head of Commodities and Crypto Index Products, to lead its commodities and...
Robert Minter, director of ETF investment strategy at abrdn takes a look at passive investing in commodities and shares his...
Ryan McCormack, Invesco
This year sees the 25th anniversary of Invesco’s QQQ, the USD240 billion ETF – the fifth largest ETF in the...
ETFs
The European ETF market achieved a record 28 per cent growth – reaching over USD1.8 trillion assets under management (AUM)...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by