The Luna AIM portfolio was launched on the 1st June 2020 – the portfolio has been created to invest in AIM companies that we deem to qualify for business property relief.

Over the first year, the Luna AIM portfolio has returned a staggering 47.4% and outperformed the FTSE AIM All Share index return of 44.6%. Whilst we are delighted to deliver such strong performance in the AIM portfolio’s first year we must more importantly remember that those investing on the first day of launch are now halfway through the two year investment time period for these assets to be outside the estate.

So why has performance been so strong?

As you can see from the AIM index market performance – this time last year companies were in hindsight very cheap. This was a function of the UK and other global nations being in lockdown and pushing the global economy into recession. Fast forward a year, we have a number of successful vaccines, which in the UK has been administered to the high priority groups and as a consequence, the economy is gradually reopening.

But that only tells half the story – the companies we have selected in the AIM portfolio have also been net beneficiaries from the Covid environment. During the year some of the big winners have been;

  • Volex Group, the power cord and cable solutions business, standout performances were seen in EV charge cables and in strong demand for consumer electronics that naturally benefited from lockdowns and increased working from home.
  • CVS Group, the veterinary services business, as we have looked for companionship during restrictions.
  • Naked Wines, the wine delivery business, as we have not been able to visit our favourite establishments, we have turned to enjoying ourselves at home.

We are not static in our investment approach at Luna, and we have sold two of the above companies and reinvested in companies that can benefit as the economy reopens.

A recent change has been to reinvest in Young & Co Brewery. We have done this to benefit from the economy reopening from restrictions and believe public houses will be a key beneficiary.

Looking forward

We continue to scour the AIM market for companies that both qualify for business property relief and we adjudge to be good quality as well. We deem quality as companies that; have good management, they are in growth mode, have high margins and a strong balance sheet.

Valuation is also a key consideration, and we look to take advantage of cheaper valuations to provide an element of downside protection. We believe this remains a very sensible approach when investing in some of the highest risk companies in the UK market.


The content in this publication is for your general information and use only and is not intended to address your particular requirements. Articles should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of any articles. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts. Levels and bases of, and reliefs from, taxation are subject to change and their value depends on the individual circumstances of the investor. The value of your investments can go down as well as up and you may get back less than you invested. Past performance is not a reliable indicator of future results.