investment trust company
investment trust company
a financial institution which issues its own shares to the investing public and which specializes in investment in FINANCIAL SECURITIES, mainly UK and overseas corporate stocks and shares and government fixed-interest securities. They tend to be attractive to smaller investors who wish to secure a wider spread of risk than they could achieve for themselves by direct investment in a limited number of securities, or who require professional management of their investments.Investment trust company shares are bought and sold on the STOCK MARKET so that, like other securities, their prices can go up or down reflecting general stock market price trends, but more particularly the company's own performance. Investment trust companies vary in the portfolios they put together and the expertise with which they are managed, so that the portfolio performance of different companies has varied from mediocre to excellent over the years.
In recent years most investment trust company shares have traded at a substantial DISCOUNT on their asset values (i.e. asset backing per share), partly reflecting small investors' preference for UNIT TRUSTS as an alternative investment medium.
Investment trust companies in the UK are represented by the Association of Investment Trust Companies (AITC), which provides a forum for the discussion of matters of general concern to members, and acts on behalf of members in dealings with other institutional bodies such as the Institutional Investors Committee and the government. The investment and management of funds by investment trust companies is regulated by the FINANCIAL SERVICES AUTHORITY in accordance with various standards of good practice laid down under the FINANCIAL SERVICES ACT 1986. See INSTITUTIONAL INVESTORS, FINANCIAL SYSTEM, PORTFOLIO.
investment trust company
a financial institution that issues its own shares to the investing public and specializes in investment in FINANCIAL SECURITIES, mainly UK and overseas corporate stocks and shares and government fixed-interest securities. Investment trust company shares themselves are bought and sold on the STOCK EXCHANGE.They tend to be attractive to smaller investors who wish to secure a wider spread of risk than they could achieve for themselves by direct investment in a limited number of securities, or who require professional management of their investments.
Investment trust companies in the UK are represented by the Association of Investment Trust Companies (AITC), which acts on behalf of members in dealings with other institutional bodies, such as the Institutional Investors Committee, and the government. The investment and management of funds by investment trust companies are regulated by the FINANCIAL SERVICES AUTHORITY in accordance with various standards of good practice laid down under the FINANCIAL SERVICES ACT 1986. See INSTITUTIONAL INVESTORS, FINANCIAL SYSTEM, PORTFOLIO, TRACKER FUND, INDIVIDUAL SAVINGS ACCOUNT.