When you invest via a collective investment scheme, you are entitle to a pro-rata share of the profits and losses, risk and rewards that accrue to the securities in that pool.
So what are the benefits
- Experienced professionals manage your money
- Low cost of entry, compared to direct investment.
- Can get your money back promptly.
- Access to a diversified portfolio.
- Ease of claiming and receiving dividends and interest.
The different collective investment schemes have this different benefits in varying degree. For instance, investment clubs may or may not have expert management (they mostly don’t). So it is important to read the about the particular scheme you are getting into for details of the associated benefits.