THE FIVE DIFFERENT TYPES OF INVESTMENT ACCOUNTS

Share dealing account – involves buying and selling shares in publicly traded companies.

Spread betting account – a type of speculation on the price of an asset (this can be any commodity, share or even currency). You bet on whether the underlying asset’s price will go up or down, but unlike share dealing you will never own the underlying asset.

Stocks and Shares Isa – a tax-efficient way to invest. You can put your money in shares or funds and any interest you earn is tax free. However, you can only invest £20,000 a year.

General Investment Account (GIA) – these accounts are like an Isa, without the tax benefits but with no limit on the amount you can invest.

Self-invested personal pension plan (SIPP) – a self-managed pension plan, which has limits on how much you can invest based on your salary.