Unit Investment Trusts (UITs)
Diversify Your Portfolio With Unit Investment Trusts (UITs)
Unit investment trusts offer a simple, convenient and affordable way to develop a well-diversified investment portfolio of stocks and/or bonds without having to select and manage the individual investments yourself.
How unit investment trusts work
When to consider unit investment trusts
Investing in unit trusts (UITs) through Wachovia Securities
How Unit Investment Trusts Work
Unit investment trusts (UITs) are baskets of stocks and/or bonds that are preselected by investment professionals to meet a specific goal (although there is no guarantee the unit trust will meet its objectives).Fixed portfolios. The investments within a unit trust are fixed for a predetermined time, which means the investments do not change unless a company is bought or merged with another company or a company's financial condition becomes irreparable. This means you always know what you own.
Buying trust units. Unit investment trusts are established for specified periods of time and liquidated to unit trust holders on their predetermined termination dates. A limited number of trust units are offered during presale purchase periods, which can last anywhere from one day to one year. During that time you can indicate an interest in buying units of the trust.
Units of a unit investment trust can be bought for as little as $1,000 ($500 for an IRA). Owning a unit of the trust means you own a proportional share of all the investments within the portfolio. It also means that, for a fraction of the cost, you can have diversified investments (including stocks and/or bonds) that would normally require $100,000 or more to purchase on their own.
Selling trust units. You can sell your trust units back to the unit trust at any time for their net asset value (based on the value of the underlying securities) less any remaining deferred sales charges, which provides you with the liquidity you may need. Some unit investment trusts then resell those "returned" units to other investors.
Because the market value of the trust units fluctuates with changes in market conditions and the value of the underlying securities, shares of the unit trust may be worth more or less than their original price when sold.
When to Consider Unit Investment Trusts
Unit investment trusts may be suitable for most investors, whether they're conservative, more aggressive or somewhere in between. That's because unit trusts provide diversification of quality stocks in a convenient and affordable package without losing the liquidity many investors need. And because the investments within the unit trust seldom change, it's easy to track the performance of your diversified investment portfolio.In addition, because a wide array of unit trusts with different investment objectives and levels of diversification are available, you may be able to find a unit trust that's right for you, whether you're a new investor or a sophisticated investor with complex needs.
Investing in Unit Trusts (UITs) Through Wachovia Securities
A Wachovia Securities Financial Advisor can help you determine whether unit investment trusts are good investments for you and help you select a unit trust that makes sense for your situation.A Wachovia Securities Financial Advisor can provide you with prospectuses for any unit investment trusts (UITs) that are currently available. You should carefully consider the investment objectives, risks, charges and expenses of the unit trust before investing. The prospectus contains this and other important information. You should read it carefully before investing or sending money.