An ISA, or Individual Savings Account, is a tax efficient way of investing in stocks and shares, that includes open-ended investment companies (OEICs), unit trust funds, and cash. There are two types of ISA; a Mini and a Maxi.
With your Maxi ISA you can invest up to £10,200 (£10,680 as from 6th April 2011) into OEIC and unit trust funds each tax year. Alternatively you can invest up to £5,100 (£5,340 as from 6th April 2011) in to a Mini Cash ISA and the balance into a Stocks & Shares ISA each tax year.
A fund is a range of stocks and shares purchased with a ‘pool’ of money received from a large number of investors. The type of stocks and shares purchased are those that aim to help the fund achieve its objectives. OEIC funds are divided into shares; unit trusts are divided into units. The number of shares or units you receive is dependent on the amount you invest and the price of the shares or units at the time of your investment.
Yes, you can invest from as little as £25 per month.
You will be sent a letter to confirm that your application has been accepted. You will also receive a statement every six months for the selected investment funds.