Teather and Greenwood has introduced its first venture capital trust (VCT), the T&G Alternative Investment Market (Aim) VCT.
As a stockbroker, Teather and Greenwood has experience of the VCT market in terms of research and corporate finance, particularly in Aim investments.
Until now it has stopped short of introducing its own product. It feels the timing is now right to apply its knowledge and skills to its own product as Aim stocks are competitively priced at present.
The VCT will invest mainly in companies quoted on Aim that have above-average income and growth potential. It will cut across a range of sectors and will be managed by former Invesco Perpetual fund manager John Sweet. Sweet's background is in Aim stocks and he was responsible for Invesco Perpetual's UK smaller companies unit trust and UK smaller companies investment trust before joining Teather & Greenwood last month.
According to Standard & Poor's, the Invesco Perpetual UK smaller companies investment trust is ranked 16 out of 27 trusts based on £1,000 invested on a bid-to-bid basis with net income reinvested over three years to November 9, 2001.
As an Aim VCT, this trust is less risky than some VCTs, but the difficulty it faces is convincing investors to part with their money despite the great buying opportunities available. Investors who usually use VCTs as a tax shelter may not have capital gains to reinvest after a period of poor returns on their other investments and some VCTs may fail to meet their target for subscriptions.