In the next article of the series, FE's Josh Ausden explains how investors can get around the problem of the market's most popular open-ended funds getting too big or closing to new money
The advantages of trusts over their open-ended counterparts are well documented. However, one benefit that is often underestimated is inextricably linked to trusts' closed-ended structure. Unlike open-ended funds, investment trusts are not as affected by inflows or redemptions, giving managers much greater freedom to express themselves. While open-ended funds can balloon in size and reach many billions of pounds in AUM within a few years of launching - the now £9bn M&G Global Dividend fund is a good example - even the oldest trusts seldom grow above £1bn. They can issue shares of course...
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