What is "investment trust"

n. a financial institution that sells shares to individuals and invests in securities issued by other companies [syn: investment company, investment firm, fund]

An investment trust is a form of collective investment found mostly in the United Kingdom. Investment trusts are closed-end funds and are constituted as public limited companies. In many respects, the investment trust was the progenitor of the investment company in the U.S.

The name is somewhat misleading, given that (according to law) an investment "trust" is not in fact a " trust" in the legal sense at all, but a separate legal person or a company. This matters for the fiduciary duties owed by the trustees and the equitable ownership of the fund's assets.