What would you like us to do with the funds you've selected
Portfolio: This shows the number of portfolios you hold. Portfolios can be constructed from Unit Trusts & OEICs,IMA Unit Trusts & OEICs,Investment Trusts,Pension Funds,Life Funds,Offshore Funds,Exchange Traded Funds and cash. Holdings and acquisition costs can be recorded so that profits/losses can be calculated. These can be calculated in terms of a number of base currencies. Overall portfolio values, as well as portfolio constituents, can be made the subject of alerts.
Watchlist: You have one watchlist, and this shows you the number of items currently stored in the watchlist. Items stored here do not have holdings records, so this list simply monitors the price of items held, which can also be subject to alerts
Funds Basket: This is designed to be a temporary collection of items selected by you for further analysis in the tools section. Items can be subsequently transferred from the Basket to the Watchlist or Portfolio.
Would you be concerned if a manager of a fund you owned took charge of another portfolio as well?
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What are the main features of an Investment Trust?
Different aims and objectives Each investment trust has its own set of investment objectives and its own board of directors. Some invest in companies from all over the world and others specialise in investing in certain countries or sectors. A trust may aim to generate as much capital growth as it can for its shareholders while others focus on delivering an income, and some may aim to do both.
Share price is determined by the stock market The share price of an investment trust depends on the supply and demand for its shares in the stock market. This can result in the price being at a Discount or a Premium to the net asset value (NAV) per share.
The movement in discounts and premiums is a useful way to indicate the market’s perception of the potential performance of a particular trust or the market where it invests. Discounts and premiums are also one of the key differences between how investment trusts and unit trusts or OEICs are priced.
Net asset value (NAV)? The net asset value (NAV) is the total market value of all the trust’s investments and assets minus any liabilities. The NAV per share is the net asset value of the trust divided by the number of shares in issue. For most trusts it is published every day on websites and in newspapers.
Ability to borrow money to make further investments Investment trusts have the ability to borrow money which can be used to buy shares. This is often referred to as 'gearing' because it has the effect of increasing the impact on the trust's net asset value of a rise or a fall in the value of the trust's investments. If any investments bought with loans rise in value by more than the cost of borrowing, the trust can pay back the money borrowed and retain the profit. The aim is to make a higher return on the investments than the cost of borrowing.
The risk is that, when the trust has to repay its borrowing and interest costs and the value of the investments is lower, the trust makes a loss. The more highly geared a trust is, (i.e. the more borrowings it has) the greater this impact will be. Not all trusts use gearing and, for those that do, the manager will only be able to borrow if the trust's board of directors agrees.
The role of the board Each investment trust has a board of directors, which is responsible for looking after the shareholders’ interests. One of the biggest decisions a board takes is deciding who manages the trust. The board is responsible for choosing and approving the strategy and aims of the trust and making sure that these objectives are followed. It also makes sure that the running costs of the trust are not excessive.
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