Gartmore Investment is moving into the venture capital trust (VCT) arena with the Gartmore premier VCT.
The VCT's objective is long-term capital growth and income by investing mainly in developing companies listed on the alternative investment market (Aim). It may also invest in unquoted companies listed on Ofex and those that plan to be AiM-listed within 18 months.
The money raised initially for this VCT will first go into a portfolio of fixed-interest securities, high-yielding smaller companies and Gartmore funds. It is intended that within the next three years, 70 per cent of the portfolio will be in AiM, Ofex and other unquoted companies while the rest remains in fixed-interest securities.
Gervais Williams heads up the smaller companies team that will manage this VCT. Williams joined Gartmore in 1993 and is currently managing Gartmore UK & Irish smaller companies unit trust.
Gartmore premier VCT focuses on companies across all sectors and will invest where the team see opportunities for unexpected earnings growth. The team will assess promising companies by conducting face-to-face meetings with companies and will also rely on its existing relationships with corporate brokers.
Investing in Aim-listed stocks is less risky than investing in companies at an earlier stage of development, but opportunities for investment may be difficult to find with other VCTs vying for the same stocks. The VCT may be risky for cautious or inexperienced investors. However, some investors may consider it as a small part of their existing investment portfolios.
According to Standard & Poor's, the Gartmore UK & Irish smaller companies fund is ranked 24 out of 69 funds based on £1,000 invested on a bid-to-bid basis with net income reinvested over three years to October 15, 2001.