What is a UNIT TRUST?

A unit trust is indeed established by a trust deed and is managed by trustees. This structure allows for the pooling of funds from multiple investors who share collective investment objectives. The trustees manage the assets of the unit trust on behalf of the investors, ensuring that the investment is conducted in accordance with the trust deed. This type of investment allows individuals, often with smaller amounts of capital, to gain access to a diversified portfolio of securities, which they might not manage independently.

The specific setup of a unit trust facilitates transparency and accountability, as the trustees have a fiduciary duty to act in the best interest of the investors. Furthermore, the trust deed outlines the rules governing the trust, including investment objectives, restrictions, and how profits are distributed. This governance structure is essential for maintaining investor confidence and ensuring that the trust operations align with its stated goals.