Managed Fund Investment Considerations

A managed funds is an investment that will allow you to put your money into an assortment of securities that tend to cover one specific industry. Like with any other type of investment strategy, it is important to look before you leap into the world of managed fund investments.

Setting Personal Goals

The first thing to consider before applying for a managed fund is your personal goal. Are you looking for quick gains or a long=term investment strategy? The performance of managed fund investments are not guaranteed. Something can always go astray with your managed fund investment and if you are not in the game for the long haul, you risk not having enough time for your investment to recover from the blow.

Do you consider yourself a conservative investor, or a risk taker? If you are not comfortable with risks, managed funds may not be in your favor. The returns of a managed fund are directly correlated to the stock market and if you opt into an aggressive fund, you heart may drop along with stock values.

Managed Fund Selection

Once you analyze your investment personality and decide to invest in a managed fund, you need to consider specific managed funds in which to invest. You must take the time to review the prospectus that accompany each managed fund. A prospectus is the literature that accompanies the managed fund and includes the product disclosure for each fund. You need to consider the history of the investment (although that is not a reflection of future performance), the fees associated with it and the industry sector your managed fund will be focusing on.

About the Author

GOBankingRates Staff

These articles are written by the in-house GOBankingRates team.

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