The world of investment is enormously diverse, so, to help you, we have broken down into more manageable pieces the various fund sectors and the areas they are allowed to invest in. This information is based on criteria provided by the Investment Management Association, formerly the Association of Unit Trusts and Investment Funds.

Active Managed
These funds tend to invest in a fairly broad spectrum of assets, up to 100% of which can be invested in equities and at least 10% of which must be in non-UK equities. They can also include a high proportion of non-equity assets.

Balanced Managed
These contain at least three different asset classes, up to 85% of which can be invested in equities (10% of which must be invested in non-UK equities). Assets must be at least 50% held in sterling/euros.

Europe excluding UK
At least 80% of a fund's assets must be held in European securities, excluding UK securities.

Global Bond
80% or more must be held in fixed interest securities from across the world. Funds are managed to benefit from varying currency and interest rates in different economies.

Global Growth
80% must be in equities (but no more than 80% in UK companies), and the prime object is capital growth.

Japan
At least 80% must be in Japanese securities.

Money Market
95% or more of assets must be invested in cash or other money market vehicles such as bank deposits and short-term fixed rate securities.

North America
At least 80% of a fund's assets must be held in North American Securities, including Canadian stocks.

Technology and Telecommunications
80% or more of a fund must be held in technology and telecommunications sectors.

UK All Companies
At least 80% of assets must be held in UK Equities, which have the primary objective of achieving capital growth.

UK Corporate Bonds
Funds that invest at least 80% of their assets in sterling-denominated (or hedged back to sterling) bonds with a triple BBB minus or above rating, as measured by either Standard and Poor's or equivalent. This sector excludes convertibles.

UK Equity Income
Funds that invest at least 80% of their assets in UK equities and aim to have a yield in excess of 110% of the yield of the FTSE All-Share index.

UK Gilts
Funds that invest at least 90% of their assets in UK Government securities (gilts).

UK Equity Bond and Income
Funds that invest at least 80% of their assets in the UK, between 20% and 80% in UK fixed interest securities and between 20% and 80% in UK equities. These funds aim to have a yield of 120% or over of the FTSE All-Share Index.

UK Smaller Companies
Funds that invest at least 80% of their assets in the UK equities of companies in the bottom 10% by market capitalisation.

Far East excluding Japan
Funds that invest at least 80% of their assets in Far Eastern Securities and exclude Japanese securities.

Global Emerging Markets
Funds that invest 80% or more of their assets directly or indirectly in emerging markets, as defined by the World Bank, without geographical restriction. Indirect investment, such as investment in companies operating in China but listed in Hong Kong, should not exceed 50% of the portfolio.
article dated 05/2003