Standard Life Investments

OEICs

What are they?

An Open Ended Investment Company ("OEIC") is a collective investment vehicle that pools your money with other investors.

An OEIC is a company in its own right, so when you invest money in an OEIC you are essentially buying shares in that company. As OEICs are open-ended vehicles (unlike investment trusts), the OEIC will issue (or redeem) shares on a regular basis in response to investor demand. This will then increase or reduce the overall size of the fund accordingly.

The OEIC fund's value is directly linked to the performance of its underlying financial assets - when their value increases, your shares grow in value too. Of course if these financial assets go down in value then so too does the value of your shares.

As the OEIC pools money from a number of investors, this larger size allows the fund manager to invest in a far greater variety of financial assets (company shares, government or corporate debt or other types of financial investments in global markets) than would be available to an individual investor. Additionally, this greater size will allow for economies of scales in relation to the cost of investing in financial assets.

How do you invest?

OEICs are easy to access either directly online from a fund provider or broker, or via a financial adviser. They can be held inside a tax-efficient wrapper such as an ISA or personal pension. Investors can also choose between lump sum and/or regular monthly payment into their OEIC.

Get the details you need on our wide range of OEIC funds