Abstracts » Business

Sales are testimony to wide appeal

Article Abstract:

Unit trusts are increasingly popular in the UK with both private investors and institutions. They still have room to expand since only 5% of adults hold unit trusts. Personal Equity Plans (Peps) have helped boost their popularity and can provide investment vehicles that are as tax-efficient as pensions. Unit trusts started out in the 1930s as a means of allowing small investors to gain access to the stock market while keeping risks low. Unit trusts can invest in cash and bonds as well as shares.

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Competition forces costs down

Article Abstract:

UK unit trusts are reducing their charges due to increased competition. The Personal Investment Authority (PIA) is to announce rules covering disclosure of charges to investors. The Securities and Investments Board (SIB) also plans to publish pricing proposals which could affect charges. Initial charges have been reduced and some companies charge only between 1% and 2%. Exit charges may become increasingly common if the SIB single pricing proposal is introduced.

Financial services industry, Financial services, Prices and rates

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The many uses of a unit trust

Article Abstract:

Units trusts can be used in a number of ways by UK investors and these include repaying mortgages and saving for children's school fees. Unit trust personal equity plans are more tax efficient than endowments for repaying mortgages. Unit trusts can also be used to increase retirement income since private retirement provision is needed due to a drop in the value of state pensions. A further use for unit trusts is a means of making investments for children.

United Kingdom, Investments

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