Understanding UCITs in the UK

The regulated funds quietly powering millions of investment portfolios – without the fanfare or the drama.

You’ve probably come across UCITs, whether you realised it or not. They’re in your pension, your ISA, your wealth manager’s carefully prepared pie chart – yet somehow they manage to fly under the radar.

Originally a creation of EU legislation, UCITs – Undertakings for Collective Investment in Transferable Securities (a name clearly written by someone who didn’t say it aloud) – are collective investment schemes designed with retail investor protection at their core. And while the UK may have waved goodbye to Brussels, it’s held firmly onto the UCITs framework, with the Financial Conduct Authority (FCA) now in charge of the show.

So, what are they, how do they work, and why do so many investors – from first timers to institutions – rely on them?