Many equity trusts are available and their names often indicate the underlying shares traded/held or the country or region in which the trusts invest i.e. Dividend Imputation Trust, Resources Trust or European Share Trust. Many fund managers provide a list of the companies whose shares may be held or traded which investors can research.
Trust investors buy units in the fund at the ‘issue or buy price’ and may sell them back to the fund manager at the ‘redemption or sell price’ on the day when a requested withdrawal is paid. On any given day the buy price is usually a little greater than the sell price. The unit price is determined by dividing the total asset value of the fund less costs such as brokerage and management, by the number of units in the fund. As the value of the shares change so do the unit prices. The price of overseas trust units are determined by both the value of the underlying shares and movement in currency exchange rates. Some funds have a currency hedging strategy to help manage the impact of currency movements.
The fund manager is responsible for the research and selection of shares, derivatives, management and administration of the trust.