Investment-trusts

An investment trust is a company in which shares can be bought, and which must be quoted on a Stock Exchange, usually the London. It is a 'pooled' investment, with many investors owning shares in the same trust.

The investment trust makes its profits by investing in the shares of other companies rather than by

manufacturing a product that it then sells. There are no specific investment restrictions for investment trusts, therefore some investments trusts are heavily invested in unquoted securities or the riskier emerging markets.

An investment trust has a fixed issued share capital, which means that the number of shares allowed in an investment trust is fixed - it is a close-ended fund.

The value of the shares in an investment trust is determined by stock market conditions, and the value may fall or rise and is not guaranteed.