Comparison table

  Open-ended investment companies (OEICs) Investment Trusts
Who regulates them? OEICs are authorised and regulated by the FCA Investment trusts are regulated by company law and the UK Listing Rules
What is the difference between 'open ended' and 'closed ended'? Open ended funds can issue new shares to meet investor demand. There is no limit, in theory, to the number of shares it can issue. Investment trusts are closed ended and have a fixed number of shares. When an investor wants to buy shares in the trust, he or she needs to buy existing shares from another investor who is willing to sell them. Some investment trusts can issue further shares or buy back shares.
What determines the price of the shares? The price of a share in an OEIC depends directly on the value of the assets the fund owns, after taking into account dealing expenses. OEICs are priced on a daily basis. The market price of a share in an investment trust is rarely the same as its share of the value of the assets owned by the fund. Its shares will normally trade below (at a discount to) or above (at a premium to) the net asset value. The share price is determined by investor demand: whether there are more buyers than sellers or vice versa for the trust's shares.
Who deals in the shares? Dealing in OEIC funds is carried out via the manager of the fund. If investors (or their advisers or platforms) wish to buy or sell, they simply contact the fund manager. Shares in UK Investment trusts are traded on the London Stock Exchange so if investors want to buy or sell them, they need to do so through a stockbroker.
Does the fund have a fixed life? OEIC funds normally do not have a fixed life span. Some investment trusts, such as split capital investment trusts, have a fixed life span. At the end of this period, it is wound up.
Can I withdraw my money at any time? Yes. M&G's funds offer daily dealing, which means you can buy or sell your shares on any business day. The price you receive will depend on the value of the assets owned by the fund on that day. Yes. Shares in investment trusts can be bought and sold on any business day. The price you receive will depend on how much investor demand there is for the shares on that particular day.