Downing AIM ISA
As of 31 May 2017, the Downing AIM Estate Planning Service (DAEPS) and Downing AIM ISA (DISA) are closed to new investors.
The present size of our AIM IHT portfolios allows us to invest in companies that have lower market capitalisations, which we believe are better value than their larger peers. In the current market, further fundraising in our AIM IHT portfolios would require a move into the more expensive investment universe which we believe would affect long-term performance and capital preservation. We have therefore taken the decision to soft-close our AIM IHT portfolios.
Our AIM IHT products are different in strategy and focus to our other micro-cap products (MI Downing Micro-Cap Growth Fund and the Downing Strategic Investment Trust) which tend to focus on taking strategic equity holdings (of over 3%) in the underlying companies. Instead, DAEPS and DISA rely on buying stocks on a regular basis and are therefore highly dependent on market liquidity and stock market pricing.
These portfolios will continue to be proactively managed in line with the investment objective. We will review the position on a regular basis and re-open our AIM IHT portfolios to new investors when we believe market conditions make it more attractive to do so.
Invest in a portfolio of 20-30 AIM-quoted companies, to combine IHT relief after two years with ISA tax benefits. Please read the key risks below.
Investors can transfer part or all of their existing ISAs to Downing. Our experienced investment team will then invest the funds in a portfolio of AIM-quoted shares. These new investments will be contained within the ISA wrapper and become exempt from IHT once they have been held for two years.
It is anticipated that each portfolio will typically be invested in AIM quoted companies. Risk will be diversified by spreading funds across at least 20 companies from several different sectors. Start-up and loss-making companies will generally be avoided.
Downing's AIM-quoted investments are managed by our Public Equity team, headed by Judith MacKenzie. The team deploys a very focused approach, investing in a maximum of 30 companies. This diligence process is akin to a private equity methodology, which we also apply to our IHT AIM portfolios and small-cap OEIC.
The ISA will be actively managed. Investments will be purchased and sold based on investment considerations, whilst endeavouring to maintain IHT reliefs, where possible. However, investments will generally not be sold unless there are suitable re-investment opportunities, in order to maintain investors' IHT reliefs.
- Downside Protection: An insurance policy covering the first two years (up until the point the portfolio should become exempt from IHT). The policy covers the first 20% of any net loss in value (after charges) on death under the age of 90 years.
- IHT relief: To provide investors with the opportunity to obtain 100% relief from IHT after two years on the value of their Portfolios of AIM traded companies.
- Ownership & control: To allow investors to retain full ownership of the investments (no need for trusts or to gift assets to obtain IHT relief).
- Capital growth: To generate capital growth from the portfolio of investments. In order to achieve this objective, companies will be selected on the basis of thorough analysis of the operational business, longevity of earnings and alignment between management and equity shareholders. In addition, risk should be reduced by spreading the amount invested across at least 20 companies in several different sectors.
- Access: To enable investors to withdraw capital from their portfolio at any time, subject to liquidity.
|Minimum initial lump sum or in specie valuation: £50,000 across DISA and DAEPS|
|Maximum ISA investment in the 2017/18 tax year: £20,000|
Method of payment for application
Payments for applications can be made by cheque, made payable to:
BMAM General Client A/C No2, or by electronic bank transfer using the payment details below.
How to apply
If you would like to invest, please first read the Brochure and Terms&Conditions before completing an application form.
- The favourable tax treatment given to ISAs may not be maintained. The rates of and reliefs from taxation may change over time and apply directly to you as a UK investor.
- Your capital is at risk. Please see the Brochure for a full list of the risk factors.
- An investment through the Downing ISA may not be suitable for all investors. We recommend that specialist independent tax, legal and financial advice is taken before investing and is not able to advise on your suitability for an investment in the Downing ISA.
- Past performance should not be used as a guide to future performance. The value of shares can go down as well as up and there is no guarantee that you will get back the amount you originally invested.
- Smaller companies are higer risk. Investing in smaller companies, which may include AIM quoted investments, is considered to have higher risks than many other investments. Investee companies may be significantly more volatile, carry higher risk and be materially less liquid than many other investments and in particular in comparison to larger securities traded on the London Stock Exchange Official List.
- This information is directed only at persons in the UK and is not an offer or invitation to buy or sell securities. An investment through the Downing ISA should only be made on the basis of the information set out in the Brochure and Terms & Conditions. Opinions expressed, whether in general or both on the performance of individual securities and in a wider economic context, represents the views of Downing at the time of preparation. They are subject to change and should not be interpreted as investment advice.