As an investment vehicle there are important advantages to the investment trust company structure.

The Manager is able to manage a diversified pool of assets with a longer term view, unimpeded by pressures to invest or disinvest because of short term cash flows in and out of the portfolio, unlike open-ended mutual funds.

Being closed-end means being able to invest in smaller and less liquid stocks, and to endure periods of illiquidity. An investment trust company has the ability to borrow to gain additional exposure in strong markets. An investment trust company enjoys more freedom to invest in unlisted or unquoted instruments than does the typical mutual fund; these freedoms will remain important to the Company if it is to benefit from the opportunities that we foresee ahead. Investors in mutual funds are liable to incur trading costs, in particular front end or back end fees. Investors in listed investment trusts, such as The Eastern European Trust PLC, pay only normal brokerage commission plus stamp duty on purchase. At the same time, closed-end investment trust companies tend to trade at a discount to net asset value, unlike mutual funds which investors in most circumstances buy and sell at close to the underlying asset value. This is why the Board has introduced mechanisms designed to help manage the discount.