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AIM was launched in 1995 and has since encouraged the growth and development of small companies all around the world. With only 10 companies and a total market value of £82 million in its first year, the market has now helped 3,654 firms from over 100 countries raise more than £96 billion.
With the inclusion of AIM shares in ISAs and lower pension limits, investors have shown an unprecedented interest in AIM shares, driven by some of the tax benefits on offer. We think this trend will continue in the future due to the rising popularity of tax advantaged investments such as VCT, EIS and BPR.
So why are some advisers wary of recommending AIM to their clients despite all the benefits? Perhaps because AIM has a reputation for high volatility and an unappealing headline performance as shown in the FTSE AIM Indices. This report will explore the risk and return profile of AIM shares in-depth and hopefully correct some of the misperceptions around AIM, giving advisers more confidence to advise on AIM based investments.
Key Findings:
- AIM has so far helped 3,654 companies raising more than £96 billion in equity capital
- More than a quarter of the firms listed on AIM have a market capitalisation of over £50 million
- The headline performance has often been driven by IPOs and investment fads
- 71% of advisers recommend investing in AIM
- 66% of advisers see their use of AIM investments either increasing or staying the same over the next two years
- Qualifying shares can provide Income Tax relief, IHT relief, loss relief and CGT deferral