What is an open investment company?
Investment company with an open end or OEIC is a corporation that is created to own an investment collection. Shares in an open investment company are sold to investors to make a profit. An open -end investment company can also be called an investment company with variable capital or ICVC. These types of companies are formed in the UK and are similar to mutual funds in the United States and Sociétés d'EstESSement à capital variable or Sicavs in Europe.
Open investment companies are listed on the London Stock Exchange. Note that this differs from most US mutual funds that are bought and sold independent of stock exchanges. An exception in the United States is the Fund traded on the Stock Exchange or ETF that trades on the stock exchange.
These companies are referred to as open investment companies because they can increase the size of the fund. The size of each so-called open-end fund is dictated by the number of investorswho want to own it. In cases where the fund becomes too large, the fund manager can conclude the fund to new investors, but those who already own this fund can buy additional stocks. It is possible that the fund is coming to all new purchases, but it is very rare.
Some types of open investment companies, called unit investment funds in the US and unit confidence in the UK, may expire at some point. Trust is created to invest in companies with a certain profile such as growth or value, small lids or a large cap. Shares are purchased when investors buy shares. When the expiry date occurs, the shares are liquidated and those who own shares in trust are paid at that time the value of their shares.
Some Trusts are managed, which means that there is a certain opening of the fund to buy the number of shares of several companies and are not madeNo other shops. Tusts are administered trusts that have a fund manager who is responsible for monitoring the performance of shares in Trust or OEIC to make sure they behave adequately. The manager has the ability to sell insufficiently executive assets in trust and replace them with shares of companies that are more likely to have better returns.