A unit trust is a way to invest with a bunch of other people in one fund or strategy. The money of all the investors is pooled together and invested in a portfolio by the fund manager, and this portfolio can be made up of different things like stocks, bonds, property, cash or other asset classes.
- Unit Trust portfolios are managed – so if you're someone who doesn't have the time to do proper research and market analysis or make changes to the make-up of your portfolio to cater for political or economic changes and events; unit trusts are a way for you to let someone else pilot those decisions.
- Investing in something that contains a range of different asset classes is a good way to stay diversified and lower your risk.
- While Exchange Traded Funds (ETFs) offer similar diversity to a unit trust, they do have a few constraints in that they are designed to track indices. A unit trust doesn't have that limitation and so you may find you are able to invest in more niche markets through a unit trust.
- Unit trusts are regulated by the Financial Sector Conduct Authority, which means your investment is in safe hands.
- Unlike an ETF which is only adjusted every quarter or so, a unit trust is more actively managed which means you pay more for the smarts used to create and manage your portfolio.
- Unit trusts don't trade on the exchange like an ETF. The trading in and out of these portfolios actually happens after the market closes. So if you're investing in a unit trust on EasyEquities, you may only see the investment reflect within a day or two, depending on the time you bought it.
EasyEquities offers a range of unit trusts put together by renowned South African asset managers like Allan Gray, Coronation, Ninety One and M&G. These are all available to you invest in with whatever amount you’ve got and many are eligible to invest in your Retirement Annuity or Tax Free Savings account, as well as your EasyEquities ZAR account.
Read more about unit trusts in our FAQs.
Find and compare different unit trusts and check which ones are available in the different accounts by using our EasyWealth site.