The Venture and Development Capital investment trust (VDCIT) sector has been the top performing inve...
The Venture and Development Capital investment trust (VDCIT) sector has been the top performing investment trust sector over the past 10 years, according to the AITC.
A £1,000 investment in the average trust in the sector 10 years ago would now be worth £7,057. Seven out of eight venture capital investment trusts have outperformed the FTSE All-Share by 5.1%pa, according to Dresdner Kleinwort Wasserstein.
The venture capital sector can be split into Venture and Development Capital investment trusts (VDCITs) and Venture Capital Trusts (VCTs). The two sectors are worth around £12.1bn combined and allow investment into small companies with a spread of risk.
Hamish Mair, fund manager of the Martin Currie Capital Return Trust, said: "There are dozens of private equity funds being raised at any one time, all of which seem to have good prospects. In reality, the strength of their proposition varies greatly. The fund of funds manager's role is to distinguish the potentials from the poor companies in this specialised market."
Ross Marshall, managing director of Dunedin Capital Partners said: "The outlook for strong returns continues to be positive. Over the long-term venture capital is not adversely affected by economic downturns, many of the recent success stories originated through investments in companies in the early 1990s."
Good governance v resources
UCITS rules need changing
Old age dependency ratio ‘outdated’
Scope for change post-Brexit
To tackle liquidity issues