What is '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

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Withholding Tax

A tax deduction made at the source of the payment.

Accounting standards

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Spot Rate

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Time-Weighted Rate of Return (TWRR)

A return calculated over the time period invested, that excludes extraneous elements, such as deposits to and withdrawals from the investment accounted.

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Annualised Rate of Return

The average annual return an investor sees over a set period of time.

What’s a collective investment scheme?