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Last year reaffirmed the status of closed-ended
funds as the go-to vehicle for unlisted assets, but
Iona Bain says liquidity isn’t the only problem
investors need to watch out for in this area
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[ UNQUOTED ASSETS ]
Investment trusts are the perfect structure for accessing
less liquid asset classes and there has been an explosion
in the number of vehicles focusing on this area over the
past decade
T
he impressive progress of Scottish
Mortgage, £9bn flagship of the
investment trust sector, has
highlighted the value of access to
private companies. Baillie Gifford’s global
trust can hold up to 25 per cent in unquoted
stocks and through assiduous networking
it has bagged early stakes in many pre-IPO
growth stars.
Its mantra is that a tiny number of
companies have historically driven a huge
proportion of all market returns, and the trick
is to find them early.
“It has built this network up to provide it
with access, and these are not VC [venture
capital] blue-sky companies, they can be
quite substantial in their own right,” says
Simon Elliott, head of investment companies
research at Winterflood. “That access is not
open to everybody.”
Investment trusts are the perfect structure
TRUSTNET
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