The Chancellor of the Exchequer said in his budget speech that he was proposing to implement a “UK ISA” into which and additional £5,000 could be subscribed. Only UK companies would qualify for such investments. This is subject to consultation and you can read my response to the consultation here: https://www.roliscon.com/_files/ugd/8ec181_36b8502e9836413492f124ebc3ee9b4c.pdf
If you wish to submit your own response go here for the details and how to respond: https://assets.publishing.service.gov.uk/media/65e734d62f2b3bd5107cd8c5/UK_ISA_Consultation.pdf
My summary comments were as follows: “As relatively few investors probably contribute the maximum amount to ISAs each year I can see little attraction in being able to contribute an additional £5,000 to a UK ISA. Even those who do contribute the maximum amount each year will simply see it as a small increase in their ISA contributions and a complication to their portfolios. In general, I see little benefit in the establishment of a UK ISA and I doubt it will significantly increase funding for UK companies. This will just be an unnecessary complication of the ISA regime.
The AIC have just published an interesting note on the top performing investment trust ISAs over the last 25 years which you can read here: https://www.theaic.co.uk/aic/news/press-releases/top-performing-investment-trust-isas-over-the-last-25-years . Many have done remarkably well with the best generating more than £250,000 from the maximum permissible investment of £7,000 in 1999. But the best tend to be sector specialists so choosing what to invest in is still important.
There was an interesting discussion between David Stredder and Chris Boxall at the Mello event on Monday. They both bemoaned the lack of good small/mid cap listed shares in which to invest and this has certainly affected trusts and funds of late. AIM listings are declining with few new IPOs. The dross is leaving and new listings are fewer partly because funding from private equity investors is now more readily available. To revive the UK stock market we need more vigorous action than inventing “UK ISAs”. The costs of listing and corporate governance thereafter are too high for smaller companies.
But it is not all doom and gloom. One successful recent listing was Fonix Mobile (FNX) who announced good results yesterday and today we had results from 4Imprint (FOUR) who are doing well in conquering the US market for promotional items. I hold both those companies so the message is that it is still possible to find good UK listed companies.
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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