The role of a trustee can be difficult in most case, but when a trust has money to invest, it can become even more troublesome.
Trustees have a duty to exercise care in investing trust monies.
This article will concentrate on issues which trustees may now wish to consider, especially as investors are becoming more sophisticated in investment matters and are seeking greater information on the way in which funds perform. Before considering how much money is available for long-term investment, it is important to examine how much money needs to remain on cash deposit, to produce income and meet any immediate needs. Having determined this, trustees can then consider the different asset classes which are available, such as bonds, property and equities. Many investors tend to choose equities for a large part of their portfolio and it is interesting to examine further why this is the case. Each year BZW produce an excellent research paper on the past performance of gilts, cash and bonds, the BZW Equity Gilt Study.