Unit trusts

• Overall


  Also known as ‘mutual funds’

  Combine funds from small investors - invest into various sectors/assets

  Businesses can be these ‘investors’ - grow the firms’ money

  Unit trusts invest in any mixture of cash, Australia or international shares, fixed interest securities (such as government bonds) or property

  Some unit trusts have also invested in gold, silver, oil and gas

  Financial manager will advise which investment from to deal with/what to invest in

  Usually connected to a management firm that offers a diversified management portfolio for investors
• Role


  Invest funds for a larger group of small investors. Unit trusts may purchase shares in a business, providing funding. Businesses can invest in a unit trust, earning dividends
• Influence


  allow businesses to diversify their income. Small businesses can make investments they otherwise wouldn’t be able to. Economies of scale reduces transaction costs