VCTs: There is a silver lining despite capacity crunch

What is the outlook after the end of this tax year?

For the first ever time, there is a possibility that come the end of the tax year there will be no open venture capital trusts. But Tom Hopkins of Kin Capital says it may not all be bad news.

Advisers and potential investors into venture capital trusts (VCTs) are beginning to panic. The simple economic equation of supply and demand is so out of kilter in the sector that we face the very real possibility of a bunch of willing investors providing lively demand but no supply of open VCTs in which to invest. Already this tax year, 24 VCTs have launched offers which have closed fully subscribed, and funds raising to date (20 March) are c.£395m, with only five VCT funds with any spare capacity left totalling c.£65m. Now, the season might have shifted earlier this tax year. Bu...