This represents a gain in total return of 3.9 per cent and 5.4 per cent respectively over the three months from 30 September 2006. The valuation growth in the quarter was attributable to both unquoted and AIM investments within the portfolios totalling 72 companies in all.

Baronsmead VCT chairman Gill Nott attributes the results to trading within the portfolio companies, coupled with the sale of the investment in the telecoms specialist Ovum before the end of the quarter, followed by pharmaceutical outfit Domantis and gaming specialist Talarius in January 2007.

Nott adds that the total returns for ordinary shareholders over the 3 and 5 years to 31 December 2006 have been 42 per cent and 52 per cent respectively.

2007 research carried out by Business XL has shown that Venture Capital Trusts (VCTs) currently have over £1 billion to invest in young, growing companies.