FAQ: Do Managed Funds Offer Better Results?

Everyone is looking for results-driven investments, especially during trying economic times. As the current state of affairs has just proven, no investment is a sure thing. Consumers should still invests prudently and within their means to help hedge their losses, as they can occur at anytime and with any type of investment. Managed funds are an investment instrument that can help easily diversify your portfolio, but it is important to realize that positive results are never a guarantee.

Research Managed Funds

When choosing an investment opportunity such as a managed fund, it is important for you to research first. Managed funds are composed of a variety of securities (both secured and unsecured), and before transferring your money into a managed fund, request the prospectus from the managing agent and review the diversification, fees, penalties and minimum requirements. Remember that historical gains provide no promises of returns in the future, so past portfolio performance should not be the deciding factor for you.

Diversification

Managed funds are directly tied into the ups and downs of the stock market and depending on the fund you are interested in, there tends to be stocks and shares of many different companies. If you were interested in investing, now would be a good as time as any as the market is down, meaning stock prices are lower. Thus your $1000 investment into a managed fund may provide you with greater quantities of market value than in the past. However, if the stock market has yet to completely bottom out, there is no guarantee that your managed funds will offer better results than any other investment opportunity right now.

Investing into managed funds should be considered a long-term investment strategy as it may take several years to get the better results from your investment. By buying low and selling high, you can hope for better than average results for your managed fund.