The Hargreave Hale AIM VCT has launched an offer for up to £30 million (£20 million + £10 million overallotment).

The VCT has total net assets of £129.5 million and a portfolio of more than 54 companies.

Although it primarily invests in companies raising money on AIM, the decline in AIM valuations has left the VCT with an exceptionally diversified portfolio that includes Marlborough managed equity funds and blue chip bonds.

Over the five years to December 2025 the VCT delivered a NAV total return of -39.5%.

The VCT targets an annual dividend equal to 5% of NAV.

Nicholas Hyett, Investment Manager at Wealth Club commented:

"The lack of appetite for UK smaller companies and an "on-again, off-again" approach to tax reform has been a toxic combination for AIM. Hargeave Hale, like most AIM VCTs, hasn't escaped the damage, losing investors 39.5% over five years.

The big question for VCT investors though is not what's gone before, but what the future holds.

The decline in AIM valuations has left the VCT with an exceptionally well diversified, and by VCT standards remarkably low risk, portfolio. 17.6% is invested in main market listed companies, with 16.4% invested in blue chip bonds giving the portfolio considerable ballast. Meanwhile the substantial AIM investments could perform very well if there is a sentiment swing in UK small and mid-caps."

About Venture Capital Trusts (VCTs)

Why VCTs are worth investing in

Most investors are initially attracted to VCTs for the tax breaks, and they are generous. Investors can get up to 30% back in income tax relief up front, falling to 20% next tax year, any dividends paid by the VCT are tax free and growth is free of capital gains tax too.

However, VCTs are more than just a tax planning tool. They're probably the best way for UK investors to access fast growing smaller companies. Revenue growth from VCT investees far outstrips what you see in main market listed companies, and the result has been some attractive returns for investors over the longer term.

Exposure to high growth, smaller companies also has the potential to diversify a conventional portfolio. Long-term performance is often only loosely correlated with the wider economy. Highly disruptive businesses grow by taking market share from incumbents rather than relying on market growth.

The rules governing VCTs mean they're also an excellent way to back smaller businesses. It's their role providing support to the next generation of UK start-ups, driving innovation and creating jobs, that earns them the tax relief from the government - and many investors feel that this is something they wish to support too.

Who should consider them?

VCTs are higher risk, and while they're listed on the stock market, in order to qualify for tax relief investors must hold the shares for at least five years before selling - making them inherently long-term investments. Unlike most conventional funds and shares the minimum amount you can invest is comparatively high - often £3,000 or more. All of this means they are best suited to wealthier or more sophisticated investors.

VCTs are popular with two groups in particular.

The first is higher earners or wealthier investors who are limited in what they can put into more mainstream tax wrappers. Those who already use the full £20,000 ISA allowance or whose pension contributions are tapered due to the amount they earn. The £200,000 a year annual VCT allowance is generous and can save higher earners up to £60,000 in upfront income tax (£40,000 next tax year).

The second group is those in, or near, retirement who use VCTs' tax free dividends to supplement income from other sources. Because they're higher risk, VCTs shouldn't be considered a replacement for a pension, but they can help to top-up income from more conventional sources.

Some other tips?

Seek diversification - VCTs are high risk so spread your investments over multiple managers. Fortunately there's lots of choice in the market, from trusts with expertise in particular sectors, like Pembroke VCT, to broad generalist funds like the Albion VCTs.

Reinvest and recycle - Get an additional 30% initial income tax relief by reinvesting those tax-free dividends (20% next tax year). You can also recycle the proceeds from selling the shares, once they've been held for five years, into a new VCT.

Be aware of discounts - VCT shares trade on the stock market, but often at a discount to the underlying value of the fund's investments. That shouldn't be a problem for long term investors, who will receive the majority of their return through tax free dividends as well as underlying growth. However, it's something to be aware of and is another reason these should be treated as long term investments.

Capacity limits - If you see something you like, it can pay to act quickly. VCTs have limited capacity each year and popular offers can quickly reach capacity and close to new investors. Some VCT managers also offer lower fees to investors who invest soon after an offer opens.

Ends

For further information contact:

Jo Thorne: jo.thorne@wealthclub.co.uk

Wealth Club

Wealth Club was set up in 2016 by former Hargreaves Lansdown director Alex Davies. The aim was to make it easier for high net worth and sophisticated investors to find authoritative information on - and invest in - tax-efficient investments (VCTs, EIS, SEIS and AIM IHT ISAs).

Today, Wealth Club is the UK's largest non-advisory investment service exclusively for high net worth and sophisticated investors. Over 68,000 people are now members. More than 13,530 of these have become clients and have invested around £1.75 billion through us (December 2025).

Wealth Club is the UK's largest broker of tax-efficient investments. In 2023, Wealth Club launched its own Managed Portfolios to help wealthier and more experienced investors make more of their mainstream investments (ISA, SIPP and General Investment Account, or GIA).

In November 2024, the Wealth Club launched the UK's first investment fund supermarket for private markets funds for sophisticated and/or high net worth investors.