Accessing three 'closed' strategies via investment trusts

Accessing three ‘closed’ strategies via investment trusts

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...