I want to start investing in more complicated investments. Where do I start?

29 July 2021

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Question by Scott

I want to invest in companies qualifying under

1) the Enterprise Investment Scheme or

2) the Venture Capital Trust scheme

I want a diversified investment in 1 or 2 above.

Which are the most highly rated (demonstrating higher than average returns/ reasonable overhead charges) outfits offering active management of such investments? On which platforms?

Thanks,

Scott


Answered by James Mallinson

Hello Scott,

Firstly, it would be remiss of me to say that investing in VCTs and EIS are considered high risk and typically not suitable for inexperienced investors. Without knowing your level of investment knowledge, expertise, or ability to suffer the real possibility of losses (despite the tax relief you receive), I’ll keep this generic as we can’t make any recommendations on this site.

Typically, VCTs and EIS are promoted either directly by Companies seeking investment or via professional investment fund managers who seek to build a portfolio of investments within their offering. There are two main research providers for this area of the market, namely MJ Hudson Allenbridge and Tax Efficient Review. These are both subscription services utilised by professional advisers to analyse the market and then make recommendations to clients based on performance track record, fees, returns, etc. To access these, you would either need to engage with a Firm who has a subscription or purchase one yourself (if available).

Most VCT and EIS offerings are not held on a Platform, however I am aware of one platform, interactive investor which does have a number of offerings available on its site. Be warned though – this does not give you research into track record, fees, returns etc. that you’re looking for above. Given the high-risk nature of these investments I’d strongly suggest that you seek professional help with this enquiry.

Answered by

James Mallinson

Chartered Wealth Manager

I’m James, a married dad with 2 children and 2 dogs. I’m unusual in the industry as I didn’t go to University, am under 40, but still rose in my career to be a Director at a FTSE listed discretionary fund management business.