Introduction to Investment Trusts
2009 January 30
Investment trusts are public limited companies and are listed on the stock market. They invest in other companies shares or sometimes property. Investors can then buy and sell shares on the stock exchange receiving dividends and potential capital growth.
Features of Investment Trusts
This type of pooled investment offers access to an expert fund manager, diversification of funds and all for a very low cost compared to direct share investment. This is because the cost of management and research is shared through all the investment trust investors.
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Number of shares is fixed and this can create a supply and demand situation.
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Normally investment trusts have more flexibility than Unit Trusts and OEICs in terms of investment choices. For example investment in Venture Capital (new companies) is possible.
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Investment Trusts are normally organised by sector or geographical regions. The Association of Investment Companies has made 38 categories.
The Royal Bank of Scotland had losses of 24Billion UK pounds and Fred Goodwin still gets 650k pension every year. That is just unbelievable! They should strip him of his pension.