How it works

In many ways OEICS are like Unit Trusts. But unlike Unit Trusts holdings in an OEIC are issued in the form of shares rather than units. Each share will represent an equal proportion of the fund.

Shares are purchased at the 'Net Asset Value' plus an initial sales charge. The fund is then professionally managed to achieve maximum returns consistent with the stated investment objectives.

It normally takes the form of an 'umbrella fund' - containing a number of 'sub-funds'. Each sub-fund has an individual investment objective and is managed by a specialist portfolio manager.

The price, and the value of an investment in an OEIC, will vary as a result of changes in the underlying value of the assets of the fund.

The range of companies and securities invested in will be more varied than the small investor could achieve on their own.