Intelligent Partnership Publish the First AIM Industry Report

Intelligent Partnership have published the first ever industry report focused on the AIM market. Part of their award winning Alternative Investment Report (AiR) series, the 80 page, CPD accredited report takes an in-depth look at AIM from advisers and financial planners’ point of view, with a particular focus on tax efficient investments.

The Report

Advisers and planners who download the report can expect to:

• Find out what their peers are thinking by reading the Market Research section. Intelligent Partnership surveyed 120 advisers to find out what they thought was good and bad about AIM, and hosted a roundtable discussion to discover how some of the most active advisers on AIM use it with their clients.
• Use the Industry Analysis to help them benchmark open offers against each other based on key investment criteria such as costs, target returns, liquidity and minimum investment levels.
• Determine what sorts of AIM listed firms are the most suitable for conservative investing by reading our in-depth analysis, and learn why they should not fall into the trap of being misled by the headline index performance and ignoring opportunities on AIM that might benefit their clients.
• Read our Manager Roundtable Discussion to see what the fund managers themselves have to say about the current state of play on AIM, what impact Brexit might have on the market and whether advisers should be concerned about a bubble in BPR qualifying stocks or not.
• Learn more about research and due diligence on AIM funds, and client suitability, in our special Advising On.. section, which includes several client case studies.

Complimentary copies of the report are available to download from the Intelligent Partnership website, and advisers can also request high quality, bound hard copies for just the price of the postage.

Why AIM?

As with many of the ‘alternative’ investments we cover, there is a strong case for investing in AIM. However, as the market as a whole tends to be more volatile than mainstream equity markets and as there has traditionally been less coverage of AIM and the funds that invest in it, some advisers and planners have understandably been cautious of investing in AIM so far.

Their objections and misperceptions include:

• AIM is a volatile and high risk market
• AIM shares and AIM funds cannot be held in an ISA
• AIM shares are not eligible for tax advantaged schemes such as EIS and VCT
• AIM shares do not confer any IHT benefits
• AIM is hard to understand and a difficult place for me to invest

The report addresses these misperceptions directly, shedding light on the sector and providing clarity for advisers who are not familiar with investing on AIM.

Why Now?

Many advisers are increasingly open to alternative investments as they search for areas where they can really demonstrate that they are adding value for their clients. Tax efficient options in particular are seen as an area where consumers are not confident making decisions without professional help, and smaller company investing has been making headlines thanks to the popularity of the EIS, SEIS and VCT schemes and online equity crowdfunding.

However, many investors and their advisers don’t realise that they do not necessarily need to invest in unquoted companies to access some of these tax benefits: a large number of AIM listed firms also qualify. Furthermore, even for investors and advisers who do understand the tax benefits, their perception of AIM is based on the headline index performance, and not on analysis of the underlying firms comprising the index, many of which have proven to be a source of reliable returns.

Finally, the acceptance of AIM shares in ISAs from 2013 makes investing in this market much more attractive that previously and introduced the concept of IHT exempt ISA portfolios.

Most advisers and planners are aware of the benefits of AIM, but many have been hesitant to use AIM funds as the perception is that they are risky. This annual Industry Report raises awareness of AIM and the funds that are investing there, giving advisers and planners more confidence to invest their clients’ money there.

Complimentary copies of the Report are now available for download here.

Key Findings:

• More than a quarter of the firms listed on AIM have a market capitalisation of over £50 million
• Qualifying shares can provide Income Tax relief, IHT relief, loss relief and CGT deferral. AIM shares are also eligible for inclusion within ISAs
• Survey shows 71% of advisers recommend investment on AIM to their clients
• Advisers are split 50:50 on whether AIM shares are only suitable for HNW investors
• AIM VCTs routinely diversify across 70 investee companies and the lowest minimum subscription is only £3,000.

Benefits of Report:

• Find out individual sector performances and stellar performers on AIM
• Get in-depth analysis of AIM based investments in the market
• Learn about suitability and due diligence on AIM investments
• Explore case studies and financial planning ideas using AIM investments

Learning Objectives:

• Explain what AIM is to their clients
• List the different tax advantages or tax advantaged options that are available
• Carry out due diligence and assess the potential risks and benefits of AIM based investments
• Identify clients and investment objectives where AIM based investments could be suitable

About Intelligent Partnership

Intelligent Partnership is the UK’s leading provider of education and insights on alternative investments. Its aim is to bring about a future where alternative investments are as understandable and accessible as mainstream assets – thus creating a more open and efficient market for everyone. We engage our 5,000+ subscriber community of advisers, wealth managers, financial services and investment professionals through a year-round programme of content that includes award-winning digital and printed reports, video content, and live events – accredited for Continuing Professional Development (CPD) by the Chartered Insurance Institute (CII), Chartered Institute for Securities and Investment (CISI) and Personal Finance Society (PFS).