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Julian Gibbs

The eTechnology venture capital trust has been launched with the intention

of investing in technology trusts and shares following the recent sharp

decline in prices.

It qualifies for 20 per cent income tax relief and 40 per cent capital

gains tax roll-over relief, with both profits and dividends being free of


Initially, it will be invested 100 per cent in technology unit trusts and

investments trusts as well as a few individual technology companies.

VCTs do not have to buy qualifying shares for the first three years of

their lives but Cavendish Asset Management, which manages over £50m within

the technology sector, will be investing in qualifying companies as and

when suitable investments arise.

The chairman is Michael Teacher, chief executive of Hillsdown Holdings,

and another non-executive director is David Svendsen, who was formerly

managing director and chairman of Microsoft.

This is a brilliant way of investing in technology stocks after the recent

market fall and with the best possible tax breaks.

Some of the main holdings will be the Close Techmark unit trust, which is

33 per cent off its high, Framlington NetNet (about 30 per cent) and SocGen

technology and Aberdeen technology (around 24 per cent).

Technology shares will certainly rise again. They have always been a

rollercoaster ride and the time to get in is when prices are low and you

can have tax breaks.

Unlike most other VCTs, eTechnology always aims to be fully invested. While the amount of money that the eTechnology VCT can take is limited, I believe that there other technology offers in the pipeline.


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