Octopus Asset Management
Aim: Growth by investing in listed and unlisted bioscience
Minimum investment: Lump sum £3,000.
Opening-closing date: October 15, 2001-April 5, 2002 for 2001/2002
tax year, April 12, 2002 for 2002/2003 tax year.
Charges: Initial 5 per cent, annual 1.25 per cent.
Commission: Initial 2.25 per cent, renewal 0.25-0.4 per cent for first
Tel: 0800 2792501.
Simon Burke – Managing director, Arctic Life &
Nick Upton – Consultant, Ian Cooke & Partners
Martin Dilke-Wing – Director, Morgans Independent Advisers
Investment philosophy: 7.3
Past performance: 5.7
Company's reputation: 5.7
Product literature: 8.3
Octopus Asset Management has introduced the bioscience venture
capital trust, which invests in both listed and unlisted bioscience
Looking at how the trust fits into the market Burke says: "Within
the venture capital trust market, this will no doubt be regarded as a
very specialised and, therefore, potentially more risky trust. However,
there is no doubt that bioscience related investments have not
suffered the same backlash as technology funds in general. I
therefore think the fund will be well received in some
Upton agrees the trust will be seen at the upper end of the risk scale,
but adds that it presents an exciting opportunity.
Dilke-Wing says: "The venture capital trust market tends to be
split between various sectors, technology, generalist, hybrid, quoted,
unquoted, Aim etc. This is the only trust of which I am aware that
specialises in bioscience specifically and, as such, provides a useful
alternative to existing issues."
Moving on to the type of client that the trust will be suitable for Upton
says: "Mostly, I would say experienced investors with
reasonably large established and diverse portfolios. The ability to
defer capital gains tax liabilities using a venture capital trust is a
useful tax planning tool for the wealthy."
Dilke-Wing feels it would be suitable for clients with a capital gain
where they wish to defer paying tax, and/or have an aggressive risk
Burke adds: "Any client who is happy to accept the real or
perceived investment risks associated with this type of project,
especially those who can take maximum advantage of the tax
concessions available to venture capital trusts. Investors who need to
make use of the tax concessions may also prefer venture capital
trusts to enterprise investment schemes due to the greater
diversification of the underlying investment."
Turning to the marketing opportunities that could be provided by the
product Dilke-Wing says: "Difficult to say at present.
Traditionally, venture capital trusts are end of tax year planning
vehicles. I am not sure what the public demand for venture capital
trusts will be this year."
Burke cannot see that the trust will provide any marketing
opportunities. Upton says: "Bioscience is a very fashionable
investment area for specialist funds, so offering those within a
venture capital trust is another approach."
Casting an eye over the main useful features and strong points of the
product Upton says: "Generically there are the obvious tax
benefits, but looking specifically at this individual product, I was
extremely impressed by the vast wealth of knowledge and expertise
brought to this venture by the various personnel involved on all sides
of the project."
Dilke-Wing picks up on the fact that the trust occupies a niche in the
venture capital trust market, as well as commenting on the
credentials of the investment committee and managers.
Burke says: "As mentioned earlier, the fact that bio-related
companies have not suffered as badly as conventional IT related
business is helpful. With an ageing population, potential for new
businesses in health related research must be on the