Managed Funds

Having money can be a problem for many of us but when we do have a nest egg or a windfall or simply save due to hard work, the question arises about control of that money. How do we manage funds? Obviously we want a safe method and one which appreciates. We certainly don’t want our money sitting still earning no interest and we definitely don’t want to lose our capital. So what is the answer?

Managed funds are extremely popular with thousands of people investing in this method of finance. Investors purchase a portfolio of investments known as units rather than simply shares. The portfolio contains a spread of investments and includes, shares, real estate, cash and fixed interest investments. Just imagine a major real estate purchase where you and 10 or 100 or 1000 other small investors all contribute to the initial purchase price. Then as the price of the property grows and a return from the lease of the property begins to flow, your investment begins to bear fruit. Of course it may take some time to do well but that is the nature of managed funds. It is not an ‘in and out’ get rich quick scheme at all.

The units are created and managed by financial experts and you as the investor can change your portfolio, both the types of investments and the areas such as different companies, different industries, etc.

 

Re-investment is good too

You can cease your investment of course but many re-invest which compounds the interest and gives an even greater return.  How you buy or contribute to your managed funds is up to you. It could be a regular deduction from your pay packet. It could be a weekly or monthly contribution and you have the satisfaction of knowing every contribution is helping build your portfolio and thus the return on your investment. You would then be deliberately and regularly building your investment portfolio. Following progress of your investment is easy as you can watch the contents of your portfolio on stock exchange data and other published sources. Your managed funds operator will send you a detailed report on the progress of your funds usually on a monthly or quarterly basis.

Your income or return from your managed funds can either be as a contribution, not unlike a dividend from a share payment or as a payment only when the unit price reaches a certain level. And of course there is always the return should you sell your investment. But knowing your managed funds are moving along solidly is a great source of personal satisfaction.

And one of the most appealing facts is that your investment in managed funds can begin with as little as $1000.  You don’t need to be a major investor with limitless funds to make a start in this area. If you wish to buy real estate it usually involves a significant upfront cash investment. Or likewise a solid parcel of shares can be a hefty investment.

That is not the case with managed funds. Begin small and continue to invest. Keep track of the progress of your units with their variety of investments.