What are OEICs?
Open Ended Investment Companies (OEICs) are collective investments which enable individuals to pool their money into a fund, which is then invested in a wide spread of assets. As the name states they are ‘open-ended’ (investment managers may create or reduce the number of shares in line with demand and supply) and are a cross between Unit Trusts and Investment Trusts, having a company structure and dealing in shares rather than units. An OEIC has a single price, both for buying and selling shares in the fund and offers investors the potential to achieve capital gains, although they do involve taking a degree of added risk. However some of this risk is lessened since you are effectively spreading it by investing in several companies at once.
