OEICS

For many clients investing directly into the stock market is too risky. We normally advise clients to invest via a collective investment, this can be a Unit Trust and OEIC or an Investment Trust. At Nicholls Stevens we have had experience of investing in collectiv investments for over 20 years. We are able to advise clients on the selection of all types of collective investments to form part of their portfolio. We believe that investing in this way via a Wrap or Platform is an inexpensive way of investing in the stock market with a spread of investments to suit your asttitude to risk.

You can invest in passive funds which are cheap and simply track the market (any of the world markets) or you can pay more for a fund manager to hopefully outperform the market. Clients need a balance between the two types of investment with a spread across different asset classes and economic areas

An OEIC is an open ended collective investment vehicle. The fund is usually valued daily and the manager quotes one price to which are added the costs of dealing. The manager must buy back the shares or units and in a time of high demand can create further shares or units.

Your questions answered

Can I achieve an income?

Yes, if you buy units in an equity income fund or a fixed interest or corporate bond fund. The frequency of payment will vary and needs to be checked.

Can I have access to my investment?

Yes but there is no guarantee of price. If you own shares/units in a property fund payment can be delayed up to 6 months.

What are the tax implications?

The fund itself pays no CGT but if you receive an income, this will be subject to tax and any gain may be subject to CGT depending on other gains and losses in the tax year. What are the charges Each fund usually has an up front charge and an annual management charge – these can be lowered by buying via a platform or wrap.

What about the risk?

You can select a fund to suit your attitude to risk.