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Basic ADVFN Video Help
ADVFN HomeHelpISA centreIntroduction to ISA8. What can a cash ISA be invested in?
Introduction to ISA
  1. What is an ISA?
  2. How does an ISA compare with other tax free forms of investment?
  3. What are the different types of ISAs?
  4. How much can be invested?
  5. Who is eligible for an ISA?
  6. What does “tax-free” mean?
  7. Which ISAs are the most popular?
  8. What can a cash ISA be invested in?
  9. What can a Life Insurance ISA be invested in?
  10. What kinds of stocks and other investments can an ISA be invested in?
  11. How do PEPs and TESSAs affect an ISA?
  12. What is a CAT Standard?
  13. What kind of return can I expect from an ISA investment?
  14. Who will provide your ISA and how about charges?
  15. How do i make investments and transfers?
  16. Summing up ISAs for 2002/2003

8. What can a cash ISA be invested in?

Investors wanting to put their money into a cash ISA face a restricted choice:
  • Cash deposited in a deposit account with a bank or a building society Investors can choose from a variety of rates quoted by providers for ISA investment

  • Units in a "money market" fund. These funds incur charges but can sometimes provide an increased interest rate return

  • Units in so-called "fund of funds" which are restricted to investing in money market funds
It is worth checking interest rates offered for ISAs with a range of providers before committing to one of them; the internet is a good place to research as rates offered change frequently.

Remember interest from a deposit account is taxed at your highest rate. Transferring an amount you do not need access to into an ISA will save you up to 40% of the annual interest.