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Collective investment scheme

What’s a collective investment scheme?

Learn what's a collective investment scheme

A collective investment scheme is a fancy legal name for any investment fund that involves multiple people pooling their money together and investing in assets.

In the UK, this could include mutual funds, investment trusts or an open-ended investment company.

Collective investment schemes benefit from economies of scale. A larger pool of money invested has the potential to provide greater returns. It can also mean that transactions and other pieces of bureaucracy incur lower costs.

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More terms

Value stocks

Stocks in companies that aren’t necessarily growing fast, but instead are dependable and stable.

Clean price

The quoted price of a gilt, which excludes accrued interest

American Depository Receipts (ADRs)

Tradeable assets that let Americans invest in overseas stocks using US laws and dollars.

W-8BEN Form

Non-US individuals and businesses may have to file this form for the Internal Revenue Service (IRS), the US tax authority.

Rate of Return

Profit on an investment, expressed as a percentage of the investment.

Interest Rate

The amount a lender charges for lending your money, or a borrower pays you for borrowing your money.

52-week high/low

The highest, or lowest, price a share has traded at in a passing year.

After-hours trading

Trading outside of a stock exchange's opening hours.

Yield curve

A graphical representation of interest rates over time

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