Investment trusts

An investment trust is a company whose business is to invest in other companies. It holds a portfolio of investments in the same way as a unit trust and is professionally managed by a fund manager. But instead of buying fund units from a private company, you invest by buying shares in the same way that you would in any publicly quoted company.

When valuing the shares of an investment trust, look at the value of all of its investments, subtract any liabilities such as debt taken out to leverage returns, and divide that figure by the number of shares. Generally, shares in an investment trust trade at a slight discount to their net asset value.

• See Tim Bennett’s video tutorial: Investing in funds – why we prefer investment trusts.

MoneyWeek magazine

Latest issue:

Magazine cover
The hunt for water

The most valuable commodity

The UK's best-selling financial magazine. Take a FREE trial today.
Claim 4 FREE Issues

Robert Shiller: why one of the world's smartest economists is worried about the bond market

Merryn Somerset Webb talks to Yale professor and Nobel Prize winner Robert Shiller about how the power of 'stories' drives the global economy and creates financial bubbles.


Which investment platform?

When it comes to buying shares and funds, there are several investment platforms and brokers to choose from. They all offer various fee structures to suit individual investing habits.
Find out which one is best for you.


27 February 1900: The Labour Party is launched

Responding to the need for a single political party to represent the trade unions, the Labour Party was formed on this day in 1900, led by MP Keir Hardie.