AIC calls for evolution of 'more balanced' funds universe in Europe to counter systemic risks

Investment trusts could help stimulate much-needed growth for European companies, as well as help mitigate systemic risks, if they are better incorporated into the region's funds market, according to a recent policy paper by the Association of Investment Companies (AIC).

The paper, entitled Balancing the EU Funds Markets, argues greater use of investment trusts would allow businesses in the region to have access to fresh funding sources, which would in turn reduce their reliance on banks and public securities markets when seeking growth capital. In addition, investment trusts have the ability to channel investment into specific areas of the economy, which could further boost growth in these sectors. New perspective Investment companies are predominantly purchased by UK investors, with more than 450 trusts trading on the domestic market. However, ...