30th Aug 2018 14:45
LONDON (Alliance News) - New Century AIM VCT 2 PLC said Thursday its net asset value increased in the first half of the year but still trailed behind the FTSE AIM All-Share index due to constraints on its investments.
As at June 30, the venture capital trust's net asset value per share was 69 pence, up 1.5% from 68p at the end of 2017. By comparison, the AIM All-Share index gained 3.7% in that same period.
"This index encompasses all sectors and includes many mining, oil and gas companies that have performed well in the year. Your fund as mentioned in previous reports is constrained from investing in most of these types of businesses as part of the venture capital trust rules," said Chairman Geoff Gamble.
Shares in New Century AIM VCT 2 were untraded at 62.00p on Thursday.
Based on its current stock price, the fund's dividend yield is 5.3%.
The number of investments which meet venture capital trust requirements decreased during the period, with only six such investments made by the company during the period.
"Although the stock market has continued to rise, we feel this has masked some of the volatility we have seen with certain companies' share prices. If a company issues a cautious outlook or disappoints the market on its expectations, its shares are hit hard with the fall in share price far outweighing the level of downgrade in earnings expectations. It is for this reason that we have kept to our strategy of holding a diverse portfolio with some smaller holdings rather than be more concentrated with fewer shares," said Gamble.
"We have a diversified portfolio with companies from a variety of sectors that continue to trade well which gives us optimism for the remainder of the year," he added.
Related Shares:
New Cent.2