Dictionary
/
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.

‍

More terms

Technical Analysis

Examining price movements of shares and other assets, and trying to predict how they will move in the future.
Read more

Maturity date

The date on which a gilt is redeemed and the gilt holder receives the repayment of the nominal amount and final dividend or coupon payment.
Read more

Margin call

Learn what a margin call stands for in financial terms.
Read more

Rate of Return

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

Depository

We look at what is a depository and what role they play in keeping markets work.
Read more

Maturity value

What's the maturity value of a bond?
Read more

Money laundering

A method of moving money obtained illicitly through the financial system so it can be used legally.
Read more

Geometric Mean Return

A way of calculating compound returns on an investment or savings over a set period of time.
Read more

Ponzi Scheme

A form of fraud designed to lure new investors, and pays the earlier backers by using the new investors' money.
Read more

You’re just minutes away from commission-free investing

open an isa
When you invest, your capital is at risk

Freetrade is your gateway to commission-free investing. Join over 1.6 million users using the Best online trading platform, as voted at the British Bank Awards for six years running.

Accounts
Customer Support
Resources
Company
Important information

Freetrade does not provide investment advice and individual investors should make their own decisions or seek professional advice. The value of investments can go down as well as up and you may receive back less than your original investment. Freetrade is a trading name of Freetrade Limited, which is a member firm of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales (no. 09797821).

© 2025 Freetrade, All rights reserved. The Apple logo is a trademark of Apple Inc. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.

Follow us on