The Lemon Fool

Can anyone point me to a good summary of issues around selling VCT holdings ?

Also do all VCTs offer annual buybacks and are there any other 'markets' or is it solely via buybacks ?

Travel
Good question but it really varies between the vct's, some run very regular (weekly or fortnightly) buy backs such as Amati & Hargreave Hale, most others offer quarterly or a little bit more frequently, these tend to be generalist funds who issue a nav update quarterly or semi annual & others who rarely do a buy back, so DYOR before you invest in a new vct.
One time that nearly all vct's offer a buy back is when they are about to issue a prospectus for a fund raise, cynical but largely true.
I personally use Share Deal Active who you can call, tell them you have left a 90 day limit order with them & request that they go to the relevant buy back broker and are put on their list. Share Deal then email you on the day of the buy back to confirm you are still happy to sell and advise you of the price. I have done this on quite a few occasions & am unaware of ever having missed a buy back. The only (modest) caveat I have is they charge £18 to send a cash amount to your bank.
They have a cheaper X-O service but I am told you are not able to call to request going on a buy back list with that but I suspect you just email them rather than phone. I know X-O is quite popular with posters on this site and I'm sure one will confirm or not.
From my perspective I'm very happy with the service I receive & just swallow the £18 fee.
Trust this helpsyou

Yes with X-O you can email to ask to be put on the buyback list after placing a limit order for 90 days.

Thanks for the replies - I have three on my radar, BSC, Titan Apollo and Pembroke - any views on their respective buyback polices and frequency ?

barchid wrote:Travel
They have a cheaper X-O service but I am told you are not able to call to request going on a buy back list with that but I suspect you just email them rather than phone. I know X-O is quite popular with posters on this site and I'm sure one will confirm or not.
From my perspective I'm very happy with the service I receive & just swallow the £18 fee.
Trust this helpsyou

Thank you Barchild for an informative post.

I'm looking at selling some VCTs - for some reason I though it was going to be a pain however it appears quite simple with X-O:

1) Open an account(no holding/monthly fees)
2) Send certificates via registered mail along with the CREST form
3) When ready to sell, email X-O

Is there any steps I'm missing?

thank you!

Onslow
No, that is exactly what I do except I have to pay £18 to see my cash, yours comes free. I do have an X-O a/c for my wife for other stocks & it works very well, a simple, barebones platform which functions even when other larger ones are down during hectic days, but do remember to give a 90 day limit order (I always use the last bid but when they check with you that you still wish to deal they give you the price then) so if it happens to be a lot lower you can decline.
Certainly easier than trying to sell them to MM's at perhaps 500 or 1000 shares at a time....

Thanks Barchid!

I've got about 12 VCT holdings in certificated form - some beyond the 5 years ands some approaching 5 years - so thinking I might send them all to X-O now, get them transferred into a Nominee account and sell when required.

Regarding Dividends, at the moment they all get paid directly to me - I assume they'll just get posted to my X-O account once tranferred?

onslow
Indeed the divis will be paid to X-O, but you can then transfer them for free to your own designated bank as & when you wish to

Hi Onslow

Did you go ahead and sign up with X-O and transfer in your VCTs?

I am thinking of doing the same and would be good to hear your experience.

TIA

Del

deltrotter wrote:Hi Onslow

Did you go ahead and sign up with X-O and transfer in your VCTs?

I am thinking of doing the same and would be good to hear your experience.

TIA

Del

Belated response to this as I only just got around to doing this a few weeks ago - process was very straightforward as mentioned from the always helpful barchid earlier in this thread. I transferred some certificated Unicorn and Albion VCT shares to Jarvis/XO.

1) Fill out the CREST transfer forms and send along with share certs to Jarvis/XO - I sent via registered post. Remember to sign the forms, the instructions on the XO website dont say this and I neglected to do so - not a problem as XO just sent the forms back to me for signing!
2) Once they had the signed forms(and the share certs I sent the week before) the shares were in my account within 2 days
3) Put in a sell offer, I did a few pence above the market price and email XO that you want to be put on a buy back list for your VCT shares
4) Within 2 days XO emailed saying there will be a buy back from Unicorn in a few days and would I like to participate - I said yes and the shares were sold
5) I also had some Albion VCTs and with no short term prospect of a company buy back, I lowered my sell price to the market bid price - and within the day they were all sold. Note even though I placed the orders on the XO website, they still have to call the market maker to sell these shares given low liquidity - even if you are selling "on market" and not as part of a buyback. Not a problem, but if you try and amend VCT sell orders on the website it can take some time for the amendment to occur as they have to manually process, unlike more liquid shares.

To give some context - I had about £10K Unicorn and £10K Albion spread across the different Albion VCTs - and while liquidity wasn't an issue this time around looking at Unicorn trading volumes if there was no buy back it likely would have taken longer to offload.

Overall very slick and efficient process. Within 1 week of having the shares in my XO account I have sold and will have the cash shortly. I dealt with Danielle from the XO trading desk via email and she was very helpful, and I am looking at moving across more business to Jarvis/XO because of the good experience.

Thanks onslow

I did sign up with X-O and have transferred in my first 5 VCT purchases. All were credited to my account within 2 days.

Can't speak highly enough about them - I wish I had them as my broker years ago!

Now just 5 years to wait until I sell.

Cheers

Del

Just quick update on this - thought it may be interesting to some on here to see the approx. returns on VCTs investments after 5 years

I put £10K in Unicorn and £10K in the six Albion VCTs in the 2016/2017 offer - with £5K in AAVC, and £1K each in the other Albion VCTs. These were my first VCT investments.

I sold all of these in late Feb 2022 and the sale proceeds were £10,800 from Unicorn and £8,900 from Albion. (timing of sale wasnt great given situation in Ukraine)

So, not great capital returns over the last 5 years. Of course I've had many dividends over the 5 years, my calculation is just over £9K given AAVC had some material special dividends in that time, as well as some smaller special divi's from other Albion VCTs and Unicorn.

All up, after 5 years my total return from £20K invested 5 years ago is about £29K. When you include tax relief, I effectively only paid £14K so a near doubling of the investment.

Not bad.

Very, very interesting, thanks onslow for posting that.

Will you be selling and reinvesting in VCTs now the 5 years is up?

Cheers

Del

Morning Del - no, the proceeds of this sale is going into a EIS opportunity.

(look at Crua on Seedrs - I think the offer has closed now though - I'm investing directly with the company, not through Seedrs, been a holder since 2017)

The regular income from VCTs is nice, I still have quite a large 5 figure holding in other VCTs - all the usual ones - Albion, Northern, Baronsmead, Hazel, Mobeus, Maven etc. The 5 year term for my remaining holdings starts in September this year, so I'll either keep them or sell if there is another opportunity.

I'm also happy that from my original £20K investment back in 2016/2017, I got 30% VCT income tax relief, plus I'm now getting another 30% tax relief from EIS!

Thanks Onslow!

I am learning from different approaches so thanks for sharing yours.

This blog post here has information on selling
gentlemansfamilyfinances.wordpress.com/2020/07/24/vcts-venture-capitalist-trusts-part-2-buy-hold-sell/

I've been trying to sell some this week and despite there being a buyback list they remain unsold since Monday.
I sold some of Unicorn last month and the deal was completed in an hour or so with XO.
I don't desperately need the money and the way the markets are at the moment, I would rather weather the storm than sell into a panic.
What is concerning is that the VCT I'm trying to sell is also raising funds. Does that mean I'm more or less likely to get my holding sold? New money for old?

VCTs that raise new money often also have regular buybacks in place.

Best indication of a VCT's buyback behaviour is the history - look back at RNSs which will tell you the scale and frequency/timing of buybacks.

Which VCT are you trying to offload?

ProVen Growth and Income VCT
From RNS they have had 3 buy backs in the last 5 months.

EarnestHummingbird wrote:I've been trying to sell some this week and despite there being a buyback list they remain unsold since Monday.

Do you mean unable to sell at all, or just unable to sell at the price you expect?

I have a price of 61p and am on the buy back list.
Investegate gives this as the sell price - so I'm not greedy (that greedy).
Happy to wait until the end of the month - I expect that they will buy back then