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  • OEICs

OEICs

Open Ended Investment Companies (OEICs)

An OEIC works in a very similar way to a unit trust except that an OEIC is legally constituted as a limited company (Plc). OEICs have been operating outside the UK for some time, but only since 1997 has it been possible to operate an OEIC in the UK.

OEICs are not trusts and do not therefore have a trustee. Instead, however, they have a depository which holds the securities and has similar duties to a unit trust trustee.

Most OEICs operate as umbrella funds which means that the OEIC is authorised and then can set up sub-funds without gaining individual authorisation for individual sub-funds. Each sub-fund has different investment aims. For example, a sub-fund may specialise in the shares of small companies or in a particular country, such as the USA. Each sub-fund can also have different charges and minimum and maximum investments. Unit trusts are allowed to do this too, but few do.

Most OEICs only have one unit price and the initial charge is added as an extra. Unit trusts always have two prices, the lower or bid price is what you get when you sell back to the managers; the higher or offer price is what you have to pay when you buy.

THE VALUE OF INVESTMENTS AND THE INCOME THEY PRODUCE CAN FALL AS WELL AS RISE. YOU MAY GET BACK LESS THAN YOU INVESTED.

Company address: Premier Financial Planning (Cheadle) Ltd, 63 Cheadle Road, Cheadle Hulme, Stockport, Cheshire, SK8 5EU
T: 0161 482 8888 F: 0161 482 8899 Email: info@premiercheadle.com

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Premier Financial Planning (Cheadle) Ltd is an appointed representative of 2plan Wealth Management Ltd which is authorised and regulated by the Financial Conduct Authority. Premier Financial Planning (Cheadle) Ltd is entered on the FCA register (www.FCA.org.uk) under no. 488845.
 
Registered office: 63 Cheadle Road, Cheadle, Cheshire, SK8 5EU. Registered in England and Wales Number: 06542655.

The information contained within this website is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.

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