London’s Alternative Investment Market is seeing liquidity drop as investors turn to the US
London’s junior market has seen its liquidity fall as investors turn to the US.
Companies on the Alternative Investment Market (AIM) have suffered a 15.4 percent decline in the average daily trading value of their shares.
This underlines wider concerns about the UK stock market as companies continue to be snapped up by foreign predators or choose to list abroad.
Average liquidity for the year to February fell from £294,300 to £248,990, according to accountancy firm UHY Hacker Young.
It says the decline was partly fueled by British investors trading in shares listed elsewhere, such as technology shares such as Nvidia.
Concerns: Companies in the alternative investment market have suffered a 15.4 percent decline in the average daily trading value of their shares
Colin Wright of UHY Hacker Young said: ‘While AIM remains an important trading platform, the decline in liquidity shows that more needs to be done to keep the UK stock markets attractive as a trading and investment platform.’
A stream of companies have abandoned their listings on AIM, dropping by 70 to 738 at the end of March. Only one company has joined, compared to 10 listed last year. In 2007 there were 1,700 companies.