Aberforth to target small caps with launch of split-cap IT fund

Aberforth Partners is launching a split-cap investment trust that will offer enhanced income by investing in UK small caps.

The Geared Income trust is planning to raise £100m, with 60% assigned to ordinary shares and 40% to zero-dividend preference shares. The seven-year company will target a dividend of 6%. A floatation is expected in late April or early May, subject to FSA approval. Investment manager John Evans says smaller companies are very attractive for investors seeking income. “We see a lot of value in the area in which we invest. Smaller companies have seen good dividend growth and are much more diversified than large caps. We can see very good valuations,” he says. “There is also a lot of de...