How would you like a tax free stream of income from an investment yielding between 7 and 8 per cent? Usually when something looks too good to be true, it either isn't (true) or there's a catch. With this particular investment, the catch is the risk you take on. That's because the investment is in venture capital trusts. We'll come to the risk in a moment. What makes VCTs stand out are their generous tax breaks and the fact that they have delivered very strong dividend returns - at the end of December 2011, generalist VCTs were yielding an average of 7.6 per cent and Aim-invested trusts 8.1 per cent. For that reason alone, it's worth considering the role VCTs could play in your portfolio. Now the risk: this is their exposure to smaller, mostly unquoted companies whose shares may be volatile and vulnerable to difficult economic conditions. Our special report on VCTs, and their cousins Enterprise Investment Schemes, by Leonora Walters analyses the advantages and risks of both, offers pointers on how to invest in them and which ones to choose. Elsewhere the Trader continues to foresee gains in the indices but has words of advice for fellow traders stuck in a relationship that's going nowhere; Mark Robinson reports on the copper supply deficit which will benefit the likes of Rio Tinto; Chris Dillow explains why interest rates might not rise until 2014 and Alistair Blair despairs at the "success" of hedge funds.