An investment trust (IT) is a listed company that has shares on the London Stock Exchange. Investors can then buy shares and subsequently become part owner of the company. Investment Trusts then invest in shares quoted on the world stock markets and are able to borrow money in order to maximise any possible investment opportunity.
When shares in an IT are purchased you are essentially purchasing shares in all of the companies that the IT invests in. However potential investors do need to remember that there is an element of risk involved in Investment Trusts and any returns will be heavily influenced by market conditions and demand and supply.
The risks involved in these trusts are less than purchasing individual shares since an IT has many equities. Investments can be made as one of payments or by regular saving schemes, it is also worth noting that this type of investment is regulated by the FSA. As with any investment of this nature our preferred partners will provide expert independent advice.
IT can be particularly suited to those who have a desire to;
- Invest in the stock market in the longer-term.
- Wish to spread their costs and the associated risks.
- Have little time to watch their investments