Friends Ivory & Sime has introduced its fourth baronsmead venture capital trust (VCT).
Baronsmead VCT 4 aims for long-term capital growth by investing in a portfolio of between 30 and 40 unquoted companies. Some of these will be listed on the alternative investment market (Aim) and are likely to be within sectors like business & financial services, consumer markets, healthcare, information technology and media & communications. Friends Ivory & Sime sees these areas as good growth prospects that have remained fairly strong during difficult times.
Friends Ivory & Sime manages three baronsmead VCTs, but baronsmead 4 VCT differs from them slightly as it will cover healthcare and life sciences. These stocks are attractive because spending by governments and pharmaceutical companies in this area is likely to increase with the ageing population requiring more medicines and medical treatments.
Unlike some recently established VCTs, this one does not simply go for companies on the alternative investment market (Aim), although some stocks may be Aim-listed. This means other VCTs are less likely to tread on its toes when finding investment opportunities.
However, VCTs that invest entirely in Aim stocks may be less risky as these companies are likely to be at a later stage of development than other unquoted stocks.
According to Standard & Poor's, the baronsmead VCT and baronsmead 2 VCT are ranked top quartile based on £1,000 invested on a mid-to-mid basis with net income reinvested over three years to October 22, 2001.