An Investment Trust is a company that has been set up to invest in the shares of other companies. By buying shares in the investment company, the investor is in effect spreading the risk that would normally by associated with a single share investment because the value of the Investment Company's shares are directly related to the spread of investments it is making.
The share price of the Investment trust should be the value of the underlying holdings called the Net Asset Value (NAV) but the share price can often be trading at a discount (or premium) to the NAV.
From a tax perspective investing in an investment trust is treated the same as investing in shares.
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