AIM VCT Performance

[scotia]

A few AIM VCTS have recently released their 6 monthly or annual reports, so I have had a comparative look at their performance.
Looking at the NAV total return over the full year (NAV_this_year - NAV_last_year + dividends_during_year)/NAV_last_year as a percentage I get

AMATI 1 (to 28/2/17) and AMATI 2 (to 31/1/17) both around 22%
Octopus AIM (to 28/2/17) 17.5%
Unicorn AIM (to 31/3/17) 11.7%
Hargreave Hale (to 31/3/17) 11.1%
Artemis (to 31/3/17) 31.5%

During this period the AIM all share index increased by around 30%

The excellent Artemis return is a bit of a red herring - since they apparently have no intention of issuing new shares. But it does show what can be achieved!

I have checked my computations, but I apologise in advance for any possible errors on my part!

[UncleEbenezer]

Take a longer-term view and the results are completely different. Even just one year. But you knew that. The slightly more interesting question (which I haven't looked into) is whether their non-VCT-microcap stablemates have outperformed the AIM VCTs as the index surged ahead.

We seem to have a hattrick of AIM VCT divis coming up in August. Finals from Amati and Octopus, and a maiden interim from Unicorn. That's currently my complete set of AIMs.

[scotia]

Agreed - one swallow does not a summer make
Taking up your other point, I checked with HL and found, over 1 year:-
Amati Smaller Cos +34.2%
Marlborough UK Microcap +32.9%
Unicorn Smaller Cos +29.23%
Artemis UK Smaller Cos +31.3%
All remarkably similar.
I'm at a bit of a loss to explain why smaller cos (including AIM) have done so well. Unlike large multi nationals, I would have thought the depreciating currency would have had little, and possibly a negative, effect.
Could it be that an interest in AIM as an IHT shelter is pushing up prices, and creating a bit of a bubble?

[Retiringat51]

Could it be that an interest in AIM as an IHT shelter is pushing up prices, and creating a bit of a bubble?

Aye

http://www.moneyobserver.com/our-analys ... aim-market

[scotia]

Retiringat51 - thanks for the link. It looks like quite a few people are getting a bit worried by the possible AIM bubble.
I have been congratulating myself on the apparent success of my AIM investments - and I remember being equally pleased with myself during the dot com bubble. I was a bit wiser after it burst. So AIM VCTs are currently doing well. I wonder if the upwards movement will ripple itself down into the unquoted (pre-AIM) market. I'm wondering if a generalist VCT is possibly the place to be - it may be less volatile than AIM VCTs.

Incidentally, Retiring at 51 does not appeal to me. I'm happy to be partly self-employed in my seventies, although fishing, gardening and country walking also have their attractions - not to mention my grandchildren!

[Lootman]

Retiringat51 - thanks for the link. It looks like quite a few people are getting a bit worried by the possible AIM bubble.

Incidentally, Retiring at 51 does not appeal to me. I'm happy to be partly self-employed in my seventies, although fishing, gardening and country walking also have their attractions - not to mention my grandchildren!

I am a little stunned and embarrassed at how well my AIM holdings have done. Several of them are up 300% or 400%, including Fevertree which I only bought because my perception of what a G&T should taste like was transformed by its products, in true Lynch style.

Is it the "sticky money" of IHT planners? Maybe. Is it a bull market phenomenon that the riskier high-beta shares will outperform until they don't? Quite possibly.

Am I going sell my nifty twenty to play for a rebound on dogs like Tesco or First Group? Noper.

To your other point, I retired younger than age 51 and have never missed working for even a minute. I can see the appeal of still being wanted, but I got over that. My kids tell me that their ambition is to retire younger than I did. The apple doesn't fall far from the fever tree . .

[Retiringat51]

Retiring at 51 was an objective so rudely interrupted by the 2007 crash.

Self-employment on a part time basis ensued as a consequence.Technology enabled its viability- no need for an office, staff,or much in the way of overheads.

A fortuitous by-product of the change in circumstances was the opportunity to learn a little about money making through asset ownership [not touched upon at school or university in my day].

In turn that information quickly evolved into a realisation that much more could be made [and lost] through making investments than ever was or could be earned from the poor fruits of labouring in professional services.

I retired last year, a contented fellow. The new role of playboy suits me well.

As for sustaining or even augmenting the fortune, to this end I have faith in the charts. On that score there's little comfort to report from a reading of the runes just now.

The FTSE AIM 100 10 year chart, for example, suggests that a curtain call upon an Act in the overall opus may well be in the offing.
All the sectoral charts appear to be in very toppy territory, come to that.

Will the new wave VCT generalists deliver well? Jury will be out a while longer on that one, I suspect. Its sobering, but worthwhile to take a hard look at the underlying companies these funds are investing into before scrambling to fill out the new subscription forms and send off your cheques.I will reflect again on any future Pembroke and Elderstreet offerings but would like to see some evidence of coming good before committing to either.

Is there too much money going into VCTs these days? Probably.Taxation legislative changes have and will continue to drive indiscriminate demand for tax avoidance products.

2017/18 may have more in common with 2006/7 than 2008/9.