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‘Private equity is alternative to venture trusts’

Venture capital trusts pro- vide little benefit beyond the tax breaks and are poor in terms of investor transparency, say industry experts.

At Money Marketing Live last week, outgoing Gerrard investment communications director Brian Tora said investment advisers should look at private equity instead of VCTs and enterprise investment schemes, saying they offer a more transparent investment vehicle.

He said that since the Chancellor cut the tax breaks on VCTs from 40 per cent to 30 per cent, the product is less attractive. Tora said: “I do not personally have money in VCTs, I prefer private equity. I am concerned about the mixed rewards of venture capital managers and I would treat with a bit of caution.”

Newton director Harry Morgan said: “Beyond the tax savings, I would not look at VCTs. There is not really sufficient research on VCTs and where they invest.”

Redmayne-Bentley head of investment Georgina Mitchell said: “The lack of transparency with VCTs is a restriction of these products. You do not tend to know what these are invested in. I can only think of one new issue this year that I have seen sufficient research on.”

Phil Bray won a Mini 1 Convertible at Money Marketing Live last week. Mr Bray is a senior financial adviser at Capital Taylor in Sheffield and is pictured here getting the keys to his prize from RBS business partner manager Simon Platt (far left)

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