11th February 2014
Investors use AIM shares to give their ISAs a boost – 7% of Hargreaves Lansdown clients hold AIM shares in their ISA.
The Government decision to allow AIM shares to be held in an Isa appears to be bearing fruit with 7 per cent of Hargreaves Lansdown clients doing so.
The firm, publishing a note this morning, points out that FTSE AIM shares have returned 18.9% since 5th August 2013 when the shares became eligible for inclusion within the tax wrapper.
Over five years FTSE AIM returned 122.1% whilst the FTSE All Share returned 100.9%.
Adrian Lowcock, Senior Investment Manager at Hargreaves Lansdown: “Investors should look beyond the FTSE AIM Index and short term performance when considering AIM shares. The index doesn’t paint the full picture and the AIM market is volatile at the extremes. Investors could see big swings in the value of their shares. However, a few companies can go on to significantly outperform the market. It is this potential for growth that makes AIM shares attractive to investors.
“The inheritance tax exemption of qualifying AIM shares has added to interest. Once certain AIM shares have been held for a 2 year period they qualify for Business Property Relief and potentially up to a 100% exemption from inheritance tax. This applies from the date the shares were acquired, even if originally they were held outside of an ISA then transferred in.”
“Investors can also access AIM through Unit Trusts and VCTs. These investments offer a more diversified approach as they invest in a number of AIM companies. Investors also benefit from the specialist expertise of the fund manager. However, there is no IHT exemption when held this way.”
Most Popular AIM shares in 12 months to 30th January 2014*
Sirius Minerals plc
Gulf Keystone Petroleum
Quindell Portfolio Plc
Xcite Energy Limited
Rare Earth Minerals plc
IGas Energy plc
Best performing AIM shares over past 12 months*
|Name||1 Year Change|
|Sigma Capital Group||826.5%|
|Thalassa Holdings Ltd. (DI)||434.8%|
|Rare Earth Minerals Ltd||400.0%|
|Best of the Best||364.3%|
|Karelian Diamond Resources||328.6%|