But investing your money in the stockmarket over the long term should easily outperform the best paying savings account. A second reason is that investment trusts are one of the cheapest ways to invest in the stockmarket. There are no hefty initial charges to pay and annual fees are normally less than 1 per cent. If you know which shares you want to buy, using an execution only stockbroker will keep your dealing costs to a minimum. Better still, lots of investment trusts run monthly saving schemes and if you invest through one of these you can save money on dealing costs.
Some managers even waive dealing costs for investors in their savings schemes.
And if you don't have a lump sum to invest, regular saving schemes allow you to invest in the stockmarket for as little as 10 a month. Third, when you invest in an investment trust you are gaining access to a professionally managed portfolio of shares and other securities. You don't have to worry about what to buy and when to sell, all the decision making is left in the hands of fund managers who have access to vast amounts of information and analysis. Fourth, investment trusts are tax efficient. When you buy and sell shares in listed companies, you could be liable to pay capital gains tax on the profit you have made but when an investment trust buys and sells shares, its gains are not subject to capital gains tax.