By Annabel Brodie-Smith
At the AIC we’ve been talking “bout a Revolution” for a while. Yes I’m humming the Beatles song as I write this. It’s taken a year and at times it’s been painful but this week we have announced an overhaul of the AIC investment company sectors following an industry-wide review.
A sector review is a bit like dismantling a lego rocket and reconstructing it into a fire station without losing any pieces and that’s not easy! But we have reached a conclusion and from the 28th May we will have 13 new investment company sectors,15 renamed sectors and in total 90 companies will have moved sector. The new sectors reflect the supersonic growth in alternative assets, up 92% over the past five years. So our two Property sectors have become Property – UK Commercial, Property – UK Healthcare, Property – UK Residential or Property – Debt. Our 29-company Debt sector has been separated into three separate sectors. A new Growth Capital sector for companies which invest in unquoted companies but do not take controlling stakes and a new Royalties sector have been created. Away from alternatives, there are three new Asia Pacific sectors and a new Technology & Media sector. Find out more about who has switched sector here. After the sell-off at the end of the year, it’s been a ‘sparking start to 2019’ and our esteemed investment correspondent, Ian Cowie, has been busy topping up existing holdings in six investment companies. He explains there is no guarantee that the stock market excitement is over but buying on the dips has worked for him over the long term. And there’s some reassurance that other investors are finding value with nearly £2.2bn raised by existing investment companies issuing new shares since the start of the year. This swift turnaround clearly demonstrates, “share prices can rise without warning and may recover as quickly as they fell”.
In addition, money journalist David Prosser looks at why investment companies are suitable for pensions. Interestingly, stockbroker AJ Bell recently revealed that six of the 10 best-selling investment funds amongst their pension savers proved to be investment companies. Many savers are also using investment companies to supplement their income in retirement and this is why we launched Income Finder last month to help investors easily research income-paying investment companies. Build a virtual portfolio so you can see which months your companies pay income and how much income you would have received over the last year. The AIC will be at the Mello Investment Trust & Funds Day next week on Wednesday 15th May in Chiswick at the Clayton Conference Centre. Sadly, I am in Guernsey but it looks like a great line-up and my colleague, Nick Britton, will be presenting alongside other investment company managers and experts. There is a special last-minute offer for Compass readers where you can buy tickets for the Trusts & Funds Day for just £10 using the discount code Compass10. Just follow this link and input the code to secure your place.
Finally, I’m a bit croaky today because on Wednesday the AIC’s communications team won the award for Press Team of the Year at the Headline Money Awards. It’s a proud personal moment for us, but more importantly, a boost for investment companies as we continue our mission to make them better understood and more widely used. After Wednesday's festivities, I’m looking forward to an early night. Have a good month! Annabel Brodie-Smith Communications Director, AIC
