UK - AIM VCTs struggle

The drops are broadly in line with declines in the AIM market as a whole, which has seen total market capital of listed companies fall from almost £100bn in December 2007 to approximately £40bn in December 2008, despite only a modest drop in the number of businesses listed. Moreover, according to Mark Wignall, managing director of VCT manager Matrix Private Equity Partners, "the AIM VCT sector will continue to be under great pressure" going forward.

Despite overall drops year-on-year generalist VCTs held up better in 2008, returning 77% of invested capital on average, against 113% over the past five years. Furthermore, the top performing VCTs over the period have all been generalist in focus and have recorded stellar performance figures, with Beringea's ProVen VCT ranking 1st with an aggregated return of 281% of invested capital (ProVen Growth and Income VCT also ranked fourth overall with 186%). "The VCT sector shrank in 2008, but the performance of tried and tested generalist VCTs held up well and showed resilience. In 2009, we see the VCT sector shifting further in favour of traditional Generalist VCTs with established track records," Wignall continues.

Additionally, environmentally-focused VCTs performed best in 2008, and although below par at an average return of around 91% of invested capital , this is impressive given the difficult investment climate. Indeed, the top-performing VCT over the year was the environmentally-focused Ventus VCT, which produced returns in excess of 134% over the 12 months.

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