AIM Industry Report 2017/18

80 81 PUMA INVESTMENTS AIM INHERITANCE TAX SERVICE ABOUT PUMA INVESTMENTS Puma Investments is a subsidiary of Shore Capital Group Limited, an AIM-quoted company with a 32- year history and a track record of working with SMEs. Shore Capital has a network of five offices including London, Liverpool and Edinburgh, is a leading market-maker on AIM and an adviser to a large number of AIM- quoted companies. The asset management division of Shore Capital, which incorporates Puma Investments, manages approximately £800m. Puma Investments specialises in Inheritance Tax Services, VCTs and EIS. Puma has raised over £330m in tax-efficient investments. The AIM Service has won the Growth Investor Award for Best AIM Investment Manager for two years running (2016 and 2017). Puma Investments has also recently won Best Tax Efficient Group at the Investment Awards. OUR AIM SERVICE The Puma AIM ITS is a discretionary portfolio service that seeks to mitigate Inheritance Tax by investing in a carefully selected portfolio of AIM shares that meet our strict stock selection criteria across quality, growth and valuation. The portfolio undergoes a full annual review each year by PricewaterhouseCoopers to ensure Business Relief qualification requirements are met. The service is managed by award- winning Investment Director, Justin Waine, who has 18 years’ experience analysing UK and European small and mid-sized companies. Prior to joining Puma Investments, Justin worked at Polar Capital Partners, where he managed a significant portion of the award-winning European Forager Fund. Since launch, the AIM ITS portfolio has increased by 63.76%, a 35.90% outperformance of the FTSE AIM All Share Index. The portfolio is constructed based on the following criteria: • Target of 20 holdings (no position greater than 10%). • Average position size of 3-6%. • Small cash position (approx. 3-5%). • Low portfolio turnover. • Minimummarket capitalisation of £50m. 95% of the portfolio companies have a market cap of £100m+. The average market cap of holdings in the portfolio is £375m. The service will not invest in companies that we do not believe qualify for BR or in early stage companies. The service is available in ISAs, allowing the investor to add IHT relief to the income tax and capital gains tax relief that an ISA gives them. The investor can access Puma AIM through a new (minimum subscription £15,000) or existing ISA account (by way of transferring from another provider), an investment account outside the ISA account or a combination of the two. An investor can also transfer from their investment account to their ISA as their ISA allowance becomes available. The AIM IHT Service is accessible via three leading wrap platforms: Ascentric, Standard Life and Transact. JUN 214 OCT 15 FEB 15 JUN 16 AUG 14 DEC 15 APR 15 AUG 16 FEB 17 OCT 14 FEB 16 JUN 15 OCT 16 APR 17 DEC 14 APR 16 AUG 15 DEC 16 JUN 17 AUG 17 180 140 170 130 160 120 150 110 100 90 80 163.8 127.9 PUMA AIM IHT PORTFOLIO PERFORMANCE PUMA AIM IHT PORTFOLIO FTSE AIM ALL-SHARE INDEX Past performance is no guarantee of future results. SOURCE: PUMA INVESTMENTS, FTSE INTERNATIONAL ABOUT THORNTONS Thorntons Investments started providing discretionary investment management services in 1995 as part of a large independent legal practice, eventually separating from them in 2014. We began actively managing our first AIM portfolios in 2006. The strong success of this service, and our close involvement with the law firm Executry, saw us launch our AIM BR service as a model portfolio in March 2017. Our investment strategy is to invest in BR qualifying AIM companies, selected for their capacity to grow, sustainable business advantage, profitability and prospective investment return. Company selection and portfolio construction are carefully considered and the strategy has a strong track record of minimising downside risk. We use our wide experience across the board to provide a high-quality service to Financial Advisers and their clients. OUR AIM SERVICE Client investment into our AIM Inheritance Tax Portfolio Service can only be placed by a financial adviser, on platform. We launched a model version of our AIM portfolio in March 2017, initially on the Standard Life Wrap platform. This offers significant cost and administrative savings for both the financial adviser and their clients. Our primary objective is to provide investors with a portfolio of AIM company shares which if held for two years are expected to qualify for Business Relief (BR), and so offer 100% relief from inheritance tax. Since outset in 2006, we have never had a single stock fail to qualify for BR. We also aim to preserve value whilst targeting growth over the long term. The portfolio is designed to manage and mitigate as much risk as possible from investment in AIM-quoted companies and this approach has demonstrated an impressive history of downside protection. This is achieved by purposely constructing the portfolio to diversify away as much sector and individual company risk as possible. Given that the portfolio is invested in equities, the strategy will be exposed to equity market falls. To mitigate this, companies are chosen for the durability of their business, strength of balance sheet and quality of cash flow. All companies in the portfolio pay a dividend, and we seek to generate an honest level of dividend income (currently 2.4% as at December 2017) which is sufficient to cover most or all of the charges. We have extensive experience of managing AIM IHT portfolios including assisting the executors. Our platform experience allows us to help financial advisers with setting up and maintaining client accounts on platform, and with cash management. THORNTONS INVESTMENTS AIM IHT PORTFOLIO SERVICE THORNTONS AIM IHT PORTFOLIO FTSE AIM ALL-SHARE 28 SEP 12 31 JAN 13 30 SEP 13 30 MAY 14 30 SEP 14 30 JAN 15 29 MAY 15 30 SEP 15 29 JAN 16 31 MAY 16 30 SEP 16 31 MAY 17 30 SEP 17 31 JAN 17 31 MAY 13 31 JAN 14 160% 140% 120% 100% 80% 60% 40% 20% 0% -20% THORNTONS AIM IHT 5 YR TR PERFORMANCE CASH INDUSTRIAL BUILDING & MATERIALS MEDIA ELECTRONICS FOOD & BEVERAGES PERSONAL GOODS HEALTH SPECIALITY FINANCE RETAIL SUPPORT SERVICES TELECOMS SOFTWARE & SERVICES THORNTONS AIM IHT ASSET ALLOCATION 1% 10% 12% 4% 10% 7% 4% 5% 7% 14% 7% 14% 5%