Morningstar Education
Investment Trusts Solutions
AIM-Listed and Official List: The Differences
Slide 2: AIM-Listed and Official List: The Differences

The Alternative Investment Market (AIM) is a sub-market of the London Stock Exchange which was launched in 1995. It allows smaller companies to float their shares and—importantly—has a more flexible regulatory system than that applied to the main market.

Slide 3: AIM-Listed and Official List: The Differences


Main Market

No minimum market cap

Minimum market cap

No trading record required

Three-year trading record required

No minimum amount of shares in public hands

Minimum of 25% of share capital in public hands

No prior shareholder approval for transations (unless it is a takeover or disposal which results in change of business)

Prior shareholder approval required for acquisitions and disposals (most cases)

Nominated adviser and broker required at all times

Sponsors needed for certain transactions

No pre-vetting of admission documents (unless it is a Prospectus under the Prospectus Directive

Pre-vetting of prospectus by UK Listing Authority

Slide 4: AIM-Listed and Official List: The Differences

The benefit of AIM is that it's designed for smaller companies so, at 30 Sep 2010, of the 567 investment companies listed in the UK, 121 of these are listed on AIM. These tend to be the smallest investment companies (although not exclusively as some larger ones are AIM-listed too, such as Utilico Emerging Markets and Arc Capital Holdings, which have market caps exceeding USD 500 million).

Slide 5: AIM-Listed and Official List: The Differences

The disadvantage for shareholders is that reporting requirements are less stringent. The AIM admission document, required prior to flotation, is less detailed than that for the main market. It is typically the very small companies that list on AIM so liquidity could be much more restricted for these compared with peers listed on the main market. If a company is listed on the main market, it is included in the FTSE UK Index series, which can help to increase liquidity. Investment Trusts can only list on the main market, they cannot list on AIM.

Slide 6: AIM-Listed and Official List: The Differences

You should take these factors into consideration when deciding if an AIM-listed company is right for you and whether you believe the long-term benefits can outweigh the increased risk associated with a company listed on AIM.

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