Alternative Investment Market

AIM (formerly the Alternative Investment Market) is a sub-market of the London Stock Exchange, allowing smaller companies to float shares with a more flexible regulatory system than is applicable to the main market.

AIM launched on 19 June 1995 and has raised almost £24 billion and has helped more than 3,000 small-medium-sized companies raise equity to support their growth. Among these are companies from particularly high-growth areas such as technology, clean-tech and biotech. Flexibility is provided by less regulation and no requirements for capitalisation or number of shares issued. Some companies have since moved on to join the Main Market, although in the last few years, significantly more companies transferred from the Main Market to the AIM (the AIM has significant tax advantages for investors, as well as less regulatory burden for the companies themselves). In 2005, 40 companies moved directly from the Main Market to the AIM, while only two companies moved from the AIM to the Main Market.

Alternative investment

An alternative investment is an investment in asset classes other than stocks, bonds, and cash. The term is a relatively loose one and includes tangible assets such as precious metals, art, wine, antiques, coins, or stamps and some financial assets such as real estate, commodities, private equity, distressed securities, hedge funds, carbon credits,venture capital, film production and financial derivatives. Investments in real estate and forestry are also often termed alternative despite the ancient use of such real assets to enhance and preserve wealth. Alternative investments are to be contrasted with traditional investments.

Research

There is a wide variety of literature on alternative investments; however, this term has been used broadly and can also refer to financial alternatives such as derivatives or other alternatives such as energy. It is difficult to find research on the investment characteristics of tangible alternatives such as art or wine due primarily to a lack of good quality data. The Goizueta Business School at Emory University has established the Emory Center for Alternative Investments to provide research and a forum for discussion regarding private equity, hedge fund, and venture capital investments.