Glossary: Split capital trust

An investment trust that offers different classes of investors difference classes of shares, typically income and capital growth but frequently expanded to include zero-dividend preference shares, stepped preference shares and highly-geared ordinary shares. Income shareholders receive all or most of the income generated by the trust and a predetermined sum at liquidation (all trusts have a pre-established wind-up date), while capital shareholders (such as zero-dividend preference share) receive no interest but the remainder of the capital at the trust’s liquidation.

Relevant to: Funds

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