Home Business News Majority of advisers plan to increase clients’ exposure to AIM over the next 12 months

Majority of advisers plan to increase clients’ exposure to AIM over the next 12 months

by Thea Coates Finance Reporter
16th Jan 24 11:56 am

New research with 100 UK financial advisers and wealth managers, by TIME Investments, which specialises in tax-efficient investment services, reveals that the majority (90%) expect to increase their clients’ exposure to the AIM market over the next 12 months and a further 10% expect allocations to stay the same.

Almost all respondents (94%) believe that AIM listed companies and SMEs will be important to the country’s economic growth over the next two years. Just 4% said they will become less important and 2% said they won’t be important at all.

Raymond Greaves, Head of Equity Funds, at TIME Investments said, “Our research shows that advisers and wealth managers have a positive outlook for AIM and recognise the renewed opportunity it presents after a tough couple of years.

“We believe that stabilising UK inflation and interest rates could be the catalyst for market recovery and renewed appreciation for some of the excellent smaller companies based and listed in the UK.”

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The three most important reasons for the highly positive sentiment towards AIM is primarily because advisers believe it offers investors unrivalled access to exciting smaller companies with new technologies and new business models.

This is followed by the increasing support growing businesses critical to the UK economy receive from the Government and thirdly, advisors believe that AIM-listed businesses could become acquisition targets by larger firms.

Other reasons cited by respondents included the fact that some businesses qualify for Business Relief, that AIM shares are exempt from stamp duty and that less analyst coverage offers more untapped investment opportunities.

TIME:AIM is an Inheritance Tax (IHT) planning service that offers a carefully selected and professionally managed portfolio of Business Relief (BR) qualifying AIM companies, giving investors the opportunity to obtain 100% exemption from IHT after just two years.

Using its unique screening approach, TIME only invests in high quality, profitable businesses listed on AIM.  The shares are also ISA qualifying, which makes the service ideal for advisers looking to transfer their clients’ ISAs into a BR qualifying investment.

Greaves added, “When we select companies for the TIME:AIM service, the key consideration is ‘quality’. In practice this means finding companies with high (and sustainably high) levels of profitability coupled with minimal indebtedness and, ideally, good growth prospects.

“This approach stood us in good stead in 2023, where our model portfolio outperformed our benchmark by over 12% and managed to deliver a positive return of 5% despite our benchmark falling 7.4%.

During the year, we took advantage of some of the price dislocations to enhance this ‘quality bias’ even further.  The vast majority of our holdings (90%+) are trading in-line with, or ahead of, expectations in their most recent trading updates.”

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