An open-ended investment company (abbreviated to OEIC, pronounced "oik") or investment company with variable capital (or ICVC) is a type of open-ended collective investment formed as a corporation under the Open-Ended Investment Company Regulations 2001 in the United Kingdom. The terms "OEIC" and "ICVC" are used interchangeably with different investment managers favouring one over the other. In the UK OEICs are the preferred legal form of new open-ended investment over the older unit trust.
As an open-ended company the manager must create shares when money is invested and redeem shares as requested by shareholders. As with other collective investments, ICVCs' main function is to make money for the shareholders. This is achieved via investing in different asset classes such as equities, fixed-interest investments, and property. By using economies of scale they facilitate access to professional investment management for small investors.
OEICs were developed to be similar to European SICAVs and U.S. mutual funds.
Read more about Open-ended Investment Company: History, Legal Structure, Umbrella Fund, Open-endedness
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