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PROVIDER SURVEY
Again we see providers and advisers are on the same page when it comes to what
percentage of an investor’s portfolio should be placed in a VCT. The majority noted
5%-10%, and the remaining respondents said it depends on the client based upon
their risk appetite, capacity for loss, investment experience and investment horizons.
We can see the providers surveyed ranged across different sectors. This may give providers a different view on what advisers and
investors should take a view on when investing in their products, as the underlying investment will be different.
Once again chiming with the responses from advisers, providers feel that the tax benefits are the main reason why investors
consider VCTs, followed by maxing out other tax-free investment wrappers. None of the providers thought that the wider social and
economic benefits had any influence, although a small percentage of advisers did include this category in their top three.
WHAT % OF AN INVESTOR’S TOTAL PORTFOLIO DO YOU FEEL IS
APPROPRIATE TO PLACE IN A VCT?
DO YOU PROVIDE... ?
0%
57%
0%
43%
<5%
5-10%
>10%
Depends upon
the client
WHAT SEGMENT OF INVESTORS
DO YOU FEEL IS SUITABLE FOR
VCTs?
Providers and advisers have similar
views on this question. 57% feel VCTs
are suitable for HNW only and 43% feel
VCTs can be suitable for both HNW and
ordinary retail investors.
High Net Worth / Sophisticated
Both
Ordinary Retail
57%
43%
33%
GENERALIST
33%
AIM QUOTED
0%
SPECIALIST
33%
LIMITED
LIFE
33%
EVERGREEN
WHAT DO YOU BELIEVE ARE THE TOP 3 REASONS FOR INVESTING IN VCTs?
Ability to generate tax-free dividends
When client has maximised ISA/pension contributions
Level of returns
Provide diversification
Income and Capital Gains Tax benefits
Wider social / Economic benefit
0% 10%
43%
43%
14%
14%
14% 14%
14%
29%
29%
29%
43%
14%
20% 30% 40% 50% 60% 70% 80% 90% 100%
Top factor
2nd top factor
3rd top factor
We surveyed nine VCT providers to assess their views of the market and see how their answers compared to advisers and investors.