ABSTRACT
The most obvious reason for the private investor's decline has been the growth of income tax from a few shillings in the pound to a level starting at around a third of income and rising to a virtually confiscatory level. The private investor, squeezed between taxation and the rising cost of maintaining traditional living standards, has typically tended to realise past savings to meet current expenses. Taxation levels apart, the general economic climate has also worked against the private investor, and mounting inflation has virtually given him the coup de grace. The private investor has thus been under a variety of economic and political pressures for over a decade. The investment trusts were the first specialised instruments designed to provide investors with a collective approach to the stock market. The unit trust movement, with a much shorter history, offers similar advantages to investment trusts but has so far proved to be more flexible.
