Unit Investment Trust

A sort of mutual fund that holds a fixed portfolio of bonds; when these mature, the trust is dissolved. One advantage of a UIT, as they are known, is that, held to maturity and barring any default, you get your principal back. In a regular mutual fund that invests in bonds, rising interest rates could lower the value of your investment and conceivably you might never get all your principal back. UITs often have more stable monthly payouts. But UITs also typically levy a sales charge, and selling early entails a commission as well as the risk that you could be less than (or even more than) you originally invested, depending on interest rates.

 

 

Investing terms and definitions starting with
Numbers A B C D E F G H I J K L M N O P Q R S T U V W Q Y Z

 

 

 

Copyright 2018 turtlemeat.com