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VCT, ISA, daft?
JohnRo
Posts: 2,887 Forumite
Are there any valid reasons to hold a VCT beyond the tax advantages they potentially offer, as opposed to (perhaps) a more mainstream PE investment vehicle?
With the new tax year approaching I'd planned on adding an infrastructure IT in a 2% of total slot as part of the specialist allocation but the relatively pedestrian, albeit dependable, nature of that asset class isn't really what I'm looking for in the specialist part of the portfolio and their hefty premiums also put me off even though they've pulled back recently.
I'm not particularly interested in the VCT tax breaks since I'm looking at this as a hold forever investment in a long term ISA income portfolio, which probably defeats the VCT object of the exercise entirely and makes that aspect irrelevant but that's how it is.
I've spent a few hours recently glossing through several websites and message boards and it's the usual information overload but haven't read anything that puts me off allocating a relatively small position (~2% of total) to an decent income generating VCT as opposed to something else perceived as safer.
I've quickly narrowed the choice down to a generalist VCT and of those EDV seems the blindingly obvious choice to me to hold in an income oriented portfolio, which is always a concern because nothing is ever that straight forward in my experience.
It has a decent discount, record, spread, income etc. The SP history is a bit choppy but nothing I haven't seen elsewhere and given the time horizon, barring catastrophic failure, doesn't bother me.
Can anyone shed light on why it might not be the obvious choice either as a VCT or as a higher risk/reward, small specialist allocation, in an equity heavy diversified income portfolio?
With the new tax year approaching I'd planned on adding an infrastructure IT in a 2% of total slot as part of the specialist allocation but the relatively pedestrian, albeit dependable, nature of that asset class isn't really what I'm looking for in the specialist part of the portfolio and their hefty premiums also put me off even though they've pulled back recently.
I'm not particularly interested in the VCT tax breaks since I'm looking at this as a hold forever investment in a long term ISA income portfolio, which probably defeats the VCT object of the exercise entirely and makes that aspect irrelevant but that's how it is.
I've spent a few hours recently glossing through several websites and message boards and it's the usual information overload but haven't read anything that puts me off allocating a relatively small position (~2% of total) to an decent income generating VCT as opposed to something else perceived as safer.
I've quickly narrowed the choice down to a generalist VCT and of those EDV seems the blindingly obvious choice to me to hold in an income oriented portfolio, which is always a concern because nothing is ever that straight forward in my experience.
It has a decent discount, record, spread, income etc. The SP history is a bit choppy but nothing I haven't seen elsewhere and given the time horizon, barring catastrophic failure, doesn't bother me.
Can anyone shed light on why it might not be the obvious choice either as a VCT or as a higher risk/reward, small specialist allocation, in an equity heavy diversified income portfolio?
'We don't need to be smarter than the rest; we need to be more disciplined than the rest.' - WB
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