What is an OEIC?
OEICs stands for Open-Ended Investment Companies (pronounced oiks). The rules for creating and operating OEICs were introduced in 1997 and many unit trusts have since converted into a OEIC structure. Unit trusts are legally very complex and only entitle an investor to participate in the assets of the trust, without actually owning a share of them. OEICs are companies in which investors buy shares, similar to buying shares in any other company. OEICs are run by an Authorised Corporate Director (ACD) whose responsibility includes selecting investments. The interests of investors are protected by a Depositary, which is an independent, authorised, third party. The ACD is similar to the unit trust manager and the Depositary to the trustee.