Aim share price growth drives massive jump in liquidity

Jasper Jolly
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The Alternative Investment Market is run by the London Stock Exchange (Source: Getty)

The value of shares listed on London’s Alternative Investment Market (Aim) last year surged to its highest in at least a decade, according to new data.

The average daily value of shares traded per company rose from £170,561 in 2016 to £279,421 last year, the second successive rise, according to analysis by accountants UHY Hacker Young.

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

Read more: No Brexit crunch for Aim share liquidity

The 64 per cent year-on-year increase was driven by a more supportive environment for commodities globally, which buoyed the share values of the large mining contingent listed on Aim.

Laurence Sacker, managing partner at UHY Hacker Young, said: “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.”

The increase in liquidity could allow big investors, who value the ability to enter and exit large positions quickly, to take more interest in the secondary market, Sacker added.

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

Meanwhile, a much stronger global growth environment than in recent years boosted EU and US markets, helping Aim-listed companies which range from small cap stocks to giants such as Asos, which has a market capitalisation surpassing many FTSE 100 blue chips.

The Aim 100 index, which measures the performance of the 100 biggest companies on London’s junior market, has risen by more than 65 per cent since mid-2016, although returns have been helped by a significant reduction in the number of companies on the market, from almost 1,700 at the end of 2007 to 960 at the end of last year.

Read more: Aim liquidity highest since credit crunch

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