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

Clean price

The quoted price of a gilt, which excludes accrued interest

Accrued interest

The interest earned on a gilt since the last dividend date. When buying a gilt, the buyer pays the accrued interest at the time of a transaction to the seller in addition to the clean price of the gilt

Net Asset Value (NAV)

The value of a company's assets relative to the number of shares it has.

Zero-Sum Game

A situation in which one person's gain is another's loss.

Xetra

A trading venue operated by the Frankfurt Stock Exchange.

DMO

The United Kingdom Debt Management Office. It’s an executive agency responsible for managing the government’s debt and cash needs, primarily through issuing gilts and Treasury bills.

Yield

Income from an investment as a percentage of its current price.

Base rate

What's the base rate?

Gilt

What is a gilt?

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