Fidelis Trust and Corporate Services Ltd



Collective Investment Schemes/Funds
A collective investment scheme is a way of investing money with others to participate in a wider range of investments than feasible for most individual investors, and to share the costs and benefits of doing so.

Terminology varies with country but collective investment schemes are often referred to as mutual funds, investment funds, managed funds, or simply funds. Around the world large markets have developed around collective investment and these account for a substantial portion of all trading on major stock exchanges.

Collective investments are promoted with a wide range of investment aims either targeting specific geographic regions (e.g., Emerging Asian Markets) or specified industry sectors.  Funds are often selected on the basis of these specified investment aims, their past investment performance and other factors such as fees.

Constitution and terminology        
Collective investment schemes may be formed under company law or by legal trust. The nature of the scheme and its limitations are often linked to its constitutional nature and the associated tax rules for the type of structure within a given jurisdiction.
Typically there is:

  • A Fund Manager or Investment Manager who manages the investment decisions.
  • A Fund Administrator who manages the trading, reconciliations, valuation and unit pricing.
  • A Board of Directors or Trustees who safeguards the assets and ensures compliance with laws, regulations, and rules.
  • The shareholders or unit holders who own (or have rights to) the assets and associated income.
  • A "marketing" or "distribution" company to promote and sell shares/units of the fund.

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