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Unit Trusts & Isas


Unit Trusts and OEICs (Open Ended Investment Companies) are collective investments which enable individuals to pool their money into a fund which is then invested in a wide spread of shares or fixed interest securities. The range of companies and securities invested in will be more varied than the small investor could achieve on their own. The fund is then professionally managed to achieve maximum returns consistent with the stated investment objectives.


Unit Trusts and OEICs offer investors the potential to achieve capital gains which exceed what is usually possible in the Building Society, however they do involve taking a degree of added risk. Some of this risk may however have been minimised because when you put your money into a Unit Trust, you are effectively buying a small quantity of shares in several companies. Which ones precisely are decided by the fund manager.

Investment in a Unit Trust or OEIC will involve a minimum lump sum which is decided by the fund manager (usually at least 500) or, in some cases via regular monthly savings subject to minimums of around 30. There is rarely a maximum imposed however, if your holding is to be within an Individual Savings Account (ISA) then the annual ISA limits will apply.