The London Stock Exchange’s Alternative Investment Market (AIM), so often cast in the role of poor relation to new markets such as Frankfurt’s Neuer Markt, has outperformed the world’s high-tech markets with a 91% rise in prices since the beginning of this year.
Private investors looking for value in technology stocks are the main factor behind the rise that compares with a 10% increase for the UK’s top 100 companies and a 13% rise for the market as a whole.
AIM comfortably outperformed its nearest rival the Straits index in Singapore which showed a 70% increase and the Nasdaq index that showed a 60% increase. In part, the performance of AIM is a reflection of how UK investors are adopting investment habits of their US counterparts, and placing a higher value on long-term potential over short-term financial performance.
Ironically, the performance of AIM follows a warning by UK regulators that investors might be pouring their money into companies that may have liquidity problems. This has had no noticeable effect on prices and, almost without exception, new issues floated on AIM have chalked high price premiums when trading has begun.
