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OEIC stands for Open-Ended Investment Company. Essentially an OEIC is a pooled investment fund of variable size in corporate form. It owns investment assets, for example stocks and shares, gilts, bonds and certain other financial instruments. The size of an OEIC varies reflecting the market value of its underlying investments. It will also fluctuate as investors buy and sell units and the OEIC has more or less funds to invest. It is in this sense that it is open-ended.

OEICs can be invested very broadly or in specific areas of the world economy, for example the United States or Emerging Markets. You can hold investments in these sorts of funds either on a standalone basis in a portfolio and many OEIC funds will also have versions which are available through ISAs and pension plans (the units in these latter arrangements, however, are treated differently for tax purposes).

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