UNIT TRUSTS

Unit Trusts and OEICs (open-ended investment companies) are structures where many investors put their cash into one fund which can then be invested in the stock market. They allow much greater diversity than you could get by investing yourself. Along with the benefits of expert investment management, they can help you spread and therefore reduce risk and can be significantly cheaper than investing alone.

Another fundamental advantage over direct equity investment is that you are only liable to capital gains tax when you withdraw money from the fund. The fund itself does not pay tax on any gains made within the fund.