Investment trust's some questions

progress1712

Hi All

I was looking at some investments trust's with jpmorgan as a way of spreading some savings into different areas. I understand the basic way a trust works to start with and I like the idea as it has a fund manager who look's after it. What I need to know do trust's have a life span or do they just keep going. I'm looking at a long term investment with a small amount of money each month for approx five years or more at the end of the term how do I sell up if I want to take the cash and run.

Thanks

david78

Investment Trust shares can be sold when you want to cash them in. You can either buy/sell them through a stockbroker, through a share plan run by the investment trust manager, or via a fund/Share supermarket like those offerred by Hendersons and Alliance Trust Savings.

Its usually cheaper to buy direct from the investment trust manager. This is especially so when making monthly purchases as the dealing charges on purchases of small amounts of shares are usually very small or zero. e.g. Baille Gifford charges 0.5% on purchases (+0.5% stamp duty), so £100 invested costs just 1.00.

Most Investment Trusts do not have a specified end date. They will just go on and on. A few have a specific end date though.

agal

Try this site http://www.theaic.co.uk/ for lots of information about ITs.

cloud_dog

Progress1712, a couple of points worth considering regarding IT's.....

1) The SP can trade at a premium or discount to the NAV, i.e. NAV=£1, SP=£1.05 (premium), or SP=£0.95 (discount).
2) Due to ITs struvture they can employ gearing (borrowing money), this can be excellent during the good times and very bad during the bad.

Because of the above I consider ITs to be slightly higher risk thant UTs/OIECs. - am a fan ot ITs though :-)

cloud_dog