UK Accounting Glossary
An investment company is a firm whose business is to invest in securities. An investment company is also known as a mutual fund, investment fund, or investment trust. An investment company pools together funds from individual investors and purchases securities, according to the investment objectives stated in its charter. To take part in the investment company, individuals buy shares in it, which go toward the purchase of securities. For individuals, the advantage of investing through an investment company is access to a wide range of possible stocks, bonds, and other securities. The investment company charges fees for its services, whether periodically or when investors buy or sell shares. Any earnings made by the company are then passed to the investors.
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This glossary post was last updated: 9th February 2020.