Funds are a popular investment option which form part of many investors’ portfolios, but they aren’t always easy to understand.

Funds are split into share classes, also known as units, which are often differentiated by different letters, but there are other acronyms, too which can make things confusing.

In this article, we explain what these letters stand for and what they might mean for your investment.

What are fund share classes?

To help explain what fund share classes are, it’s useful to understand how funds work.

Investment funds are typically made up of shares from dozens of different companies, and when you invest in them your money is pooled with that of other investors. Most funds have different units or share classes which all invest money in the same fund, but offer different features and fees to suit the needs of different investors.  You can read more about investment funds in our article Investing – the basics.

For example, one fund class might be suitable for investors who want income, while another might be for investors simply seeking growth. One might also have a larger  minimum investment as it’s aimed at large investors (such as pension funds) but  low annual fees, whereas another might have a lower initial investment requirement, but higher fees. 

Different classes typically have different acronyms and/or letters in the title.

What do the letters in fund titles mean?

The letters in fund titles usually determine the fund’s class or unit. Some funds will also use numbers or roman numerals to help differentiate the different units.

It’s important to note that the naming of different share classes aren’t consistent across the investing world, or even investing platforms, so class A for one fund you’re considering investing in won’t be the same as another fund’s class A. 

This is just one reason why it’s important to carefully read the fine print of any investment you’re planning to make. You can always speak directly to the investment platform you’re looking at using and they can talk you through exactly what an investment fund’s features and fees.

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Share class letters explained

A single fund may come in several different versions. Some of these differences are universal across all funds and some are unique to a particular fund. Bear in mind that there is no single accepted definition for these letters so while there might be some funds that use these definitions, it’s always best to check the fine print.


If a fund has an I after its name, it’s normally one that’s aimed at institutional investors (such as pension funds). That means it may have a high minimum investment amount – which could be very high at between £500,000 and £1 million. In return, the institutional investor would pay a lower ongoing fee. 

You may also be able to invest in I class shares if you don’t want to invest via an ISA, a junior ISA or the fund manager’s savings plan.


An R means that the fund is aimed at ordinary investors, who are also known as ‘retail investors’, hence the R label (rather than, for example, large pension funds). This fund  may have a very low minimum investment amount (it could be as low as £50 if you are going to invest monthly). The trade off is that the charges are generally higher.

A, C, X, Y, Z or other letters

These letters are most commonly used to differentiate between different units of the same fund, but funds can use them differently. 

These letters could also indicate that the shares are only available to specific groups. So, for example, the shares might be limited to direct investors, via independent financial advisers or platforms, existing investors or through large investment platforms.

Other acronyms explained

Acc or Inc

This abbreviation outlines whether the fund unit you want to invest in accumulates your money (Acc) or pays you an income (Inc).

If you choose an accumulating fund then the money earned on your investment will be reinvested into the fund, effectively buying more units in the fund. Over time this could see your investment grow considerably. This is usually suitable if, for example, you’re saving into a particular fund towards retirement, as you want your investment’s value to grow over many years rather than pay an income. 

An income fund, on the other hand, will pay you any profit in cash, effectively creating an income from your investments. 

Investing can come with lots of jargon, and if you’re feeling baffled by it, have a look at our guide Investing jargon explained.

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