Investment Products
If you invest in shares for the long term you can make more money than just sticking your cash in the bank. Find out about some of the important products that can save you tax and reduce the risks.

   Unit Trusts and OEICs

 Like Investment Trusts, Unit Trusts and Open Ended Investment Companies (OEICs) are pooled investments, that offer you the chance to enjoy the growth in the stock market without the risks of investing in one share.

Your money, along with others who have invested in the Unit Trust or OIEC is invested in a range of shares, gilts, bonds or cash deposits by experts.

Unlike Investment Trusts, Unit Trusts are divided into units. The value of these units is calculated on a regular basis, normally every day. The number of units in a trust varies depending to the demand from investors.

OEICs are the modern equivalent of unit trusts. Essentially they are a cross between Unit Trusts and Investment Trusts, retaining the open ended nature of unit trusts, but having a company structure and dealing in shares rather than units.

One of the main differences is that for the OEIC a single price for both buyers and sellers is available, with charges are shown separately. By contrast, a Unit Trust has a bid price and a offer price. You can buy at the offer price and sell at the bid price. The difference between these is called the bid/offer spread.

There are hundreds of Unit Trusts and OEICs to choose from, depending on your investment requirements and the level of risk you want to take.

Some funds are very generally invested across a wide range of companies in different sectors and geographical areas. Others are far more specialist, perhaps focusing on a particular country, such as the US, or a specific sector, such as technology.

DigitalLook.com will be introducing a comprehensive and interactive guide to Unit Trusts and OIECS in the near future - explaining what you need to know before you invest, how to invest, what products are on offer, charges involved and what to look out for.
 
 
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