4
Structural advantages
Chapter 2 established that investment trusts have tended to outperform both open-ended funds and their benchmarks by some margin. Chapter 3 suggested this has been assisted by their history of charging lower fees but that this disparity in fees has narrowed in recent years as investors and regulators have queried management fees, particularly those charged by unit trusts. However, lower fees alone do not explain the better performance record. This chapter explores why the very structure of investment trusts has also assisted.
Merits of a closed-ended structure
Numerous industry statistics prove investment trusts have on average outperformed. But if further evidence were required, testimony from fund managers and board ...
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