Friends Ivory & Sime has followed up its AiM venture capital trust with the Aim VCT2
The AiM VCT 2 is aiming for long-term capital growth and will invest in around 50 companies listed on the Alternative Investment Market. These companies will be developing UK companies in the technology sector and related areas such as biotechnology, healthcare and business software.
It is a better time to invest in technology compared to earlier in the year, when the dot.com bubble burst and the prices of technology stocks were corrected. Friends Ivory & Sime feel technology is still the way forward but will carefully select stocks. Dot.coms that could perish within a few months will be avoided.
However, the sector can be volatile which means the AiM VCT 2 is unsuitable for risk-averse investors. The tax breaks that venture capital trusts offer include deferral of capital gains tax and up to 20 per cent income tax relief if shares are held for at least three years. This makes the Friends Ivory & Sime a suitable investment for higher rate taxpayers and those with a capital gains problem.