Share Price Growth of Aim Leads to Huge Increase of Liquidity

According to new data, the value of the shares that are listed on the Alternative Investment Market (Aim) of London in 2017 rose to its highest in at least a decade.

According to analysis that were made by accountants UHY Hacker Young, the average daily value of shares that are traded per company increase from £170,561 in 2016 to £279,421 in 2017, the second successive increase.

June 2017 experienced an average daily trade volume £300,740, the highest average daily trade volume per company ever.

The 64 percent year-on-year rise has resulted from a more supportive environment for commodities globally, which buoyed the share values of the large mining contingent that are listed on Aim.

The managing partner at UHY Hacker Young, Laurence Sacker, stated: “The huge increase in liquidity on AIM is a reflection on how far the market has been helped by the recovery of the resources sector.”

Sacker added that the rise in liquidity could enable large investors, who value the ability to quickly enter and exit large positions, to have more interest in the secondary market.

He stated: “AIM is also slowly getting closer towards its ambition of being a market of growth companies institutions can invest in.”

On the other hand, a much stronger global growth environment as compared to recent years improved the US and EU markets, helping companies that are listed in AIM which range from small cap stocks to giants including Asos, which has a market capitalisation that surpasses many of the FTSE 100 blue chips.

The Aim 100 index measures the performance of the 100 largest companies on the junior market of London, has increased by more than 65 percent since mid-2016, even though returns have been helped by a significant drop in the number of companies on the market, from almost 1,700 at the end of 2007 to 960 at the end of 2017.