The Alternative Investment Market (AIM) poses a higher risk

About a year ago, the trend as predicted by experts on investments is on the FTSE 100 stocks and buying of blue chips. It sounded great at that time, considering the fall in indices reached up to 14 percent with the AIM as compared to the FTSE during those days. You would even gained about 5 percent income.
 

Taxes

Unfortunately, it does not hold true nowadays. Cheap investments are now found at the lowest fall in price/earning ratio, with AIM being only at 6.3 times. The bargain is set on the taxes that are collected from the capital gains of these stocks. These started at one fourth of the rate given to big time taxpayers. Unfortunately, taxes are the only one that’s going up.

Inheritance taxes also pose a bigger problem with AIM. Although considered immune before, couples are now trying to go around the inheritance tax problem and get a better deal.

Aversion to risk

 
The local companies, with smaller capitals are the most affected when the economy gets a beating, as compared to those multinational companies who often have a buffer system to use when things go awry in their shares. There are also a lot of problems that have greatly affected the economy. The real estate market is experiencing its lowest numbers in decades. A lot of people are facing the reality of unemployment, with the construction business at its lowest. It is only the prices of crude oil that have gone up, including interest rates due to inflation.

According to John Glencross, by Calculus Capital, AIM is being marketed to foreigners who would like to be listed internationally, since the pay is bigger as compared to the local companies who only invest a few but expect millions in exchange. As seen by the listings of last year, they dealt with larger funds as well with properties.

Using AIM helps in regulating the arbitrage that is collected from companies overseas. It does not need many requirements although commissions are fast to get and easy to earn. You definitely will earn big from these listings but for smaller companies, the funds seem hard to get. However with AIM, it does not suit even debt markets. Therefore, the ability to liquidate stocks has experienced a brief hiatus. And AIM does not even make a difference, even if you plan to have a private and small company which often cost a lot more than their worth.