A BEVEK or SICAV is a open-ended fund contained within an investment company. BEVEK stands for BEleggingsvennootschap met VEranderlijk Kapitaal (investment company with variable capital). SICAV, or Société d’Investissement à CApital Variable, is the equivalent French term.
Investment fund with a constant stream of income and expenses
The capital of a BEVEK changes all the time. It rises when new investors buy into it or if existing investors add to their holding. The company raises extra funds by issuing new units. If investors sell all or some of their units, the BEVEK utilises its capital to redeem the units and pay out on them.
Most investment funds are BEVEKS.
Features of a BEVEK/SICAV
- How often you can buy or sell units in a fund is limited. You do so at the net asset value/price of the unit at the relevant moment
- That net asset value/price, or market price, is usually calculated each day
- A BEVEK or SICAV can consist of various components, or sub-funds, and a sub-fund can have various classes of units (sometimes called 'shares'). Each sub-fund and unit class has its own investment policy and net asset value/price, and can be invested in separately
Types of units in BEVEKs
There are different kinds of units in a BEVEK, sub-fund or unit class that you can invest in:
- Capitalisation units : the company automatically ploughs dividends back into the fund. We recommend this type of unit if you want to invest long term and are looking to take advantage of the added return that capitalisation can offer
- Distribution units: you receive an annual dividend, on which you have to pay withholding tax. We recommend this kind of unit if you regularly want to cash in your profit
- A combination: some BEVEKs offer both capitalisation and distribution units. You are free to choose which type to invest in
Investing is easy
The great benefit of a BEVEK is that you don't need to be a big earner. For instance, you can start up an investment plan with as little as 25 euros a month, investing in one or more BEVEKs, sub-funds or unit classes.
Even though the amount may not seem much, your investment is still widely diversified, giving you an automatic proportional investment in all the shares, bonds, liquid assets, etc. invested in by the fund, the sub-fund or the unit class.
Costs associated with a BEVEK/SICAV
When you invest in a BEVEK, the charges you pay include:
- entry and exit charges
- 30% withholding tax on dividends
- 1.32% stock market tax on exit, subject to a maximum of 4,000 euros
- 30% capital gains tax when you sell a holding in a BEVEK that invests more than 25% of its assets in fixed-income securities (like bonds)