Investments Trusts Flashcards
Regulation
Not FCA regulated
Regulated by HMRC, UKLA, Co act
Investment Trust
Legally a company (limited companies )
Listed company
Closed ended company
Incorporated in normal way (memo + article)
DEF investment trust
Investment company with fixed share capital listed on LSE
What ended are Investment trusts
Close ended
don’t expand contract size
Investment trust trading
Normally trades at discount to net asset value of investment trust
Close ended
Fund which cannot expand or contract in size
Looks after assets of investment manager
Custodian
Borrowing powers
Able to borrow money for gearing purposes
REITS
Real Estate Investment Trusts
Investment trust that invest directly in property
Benefits of REITS
Liquidity
REIT don’t pay corporation tax of 90 % of income
ISA compliant
Costs lot lower than direct property
Disadvantages of REits
Volatility - buying shares not the property
Tax
Liquidity for REITS
Greater for both buyers + sellers in REITS rather than direct property
