A Guide to Buying Mutual Funds in the Philippines
Mutual funds have become a popular investment vehicle in the Philippines in the past years. The main reason for its popularity is the fact that it has more advantages over other investment options. If you are planning to invest in mutual funds, a basic rundown is given below to guide you with this particular investment option. .
In a mutual fund company, investors pool in their money to come up with an asset base. A fund manager then becomes responsible with how the assets are to be invested. The fund manager sees to it that the investment portfolio of the company is diversified to ensure maximum gains for its investors. Some of the investments that a fund manager may choose to invest in include stocks, bonds, real estate, and money market investments.
The legal owners of the mutual fund company are the investors themselves. The amount of their ownership depends on the number of shares they bought. This is also the determining factor for the income their investment will bring them. A mutual fund can earn income in two ways. The first one is through the dividends and interests earned by the funds investments. The other way is through the capital gains earned when the cost of security increases. Once the fund gains income, it will then be distributed accordingly to its shareholders.
There are several reasons why mutual funds are popular today. The most obvious one is the minimal investment required. With P5000, the average Filipino worker can now take part of this lucrative industry. One other reason is that an investor wont have to do so much work to see his money grow as a professional fund manager takes care of this. Mutual funds are also easily converted to cash when needed.
Yet mutual funds also have a negative side. The presence of a fund manager can be good, but it also means that you wont be able to take part in the decision-making process. With whatever investment the fund manager chooses to put the funds money in, the only thing you can do is hope that it will yield positive returns for the company. Also, be aware that certain mutual fund companies charge fees. You should take this into consideration as it can affect your investment in the long-term.
In contrast, mutual funds also have its disadvantages. One of which is that you wont be part of the decision making process with regards to how your money will be invested. Since a fund manager is the one who makes this decision, you can just hope he chooses the right investments for the mutual fund company. The worst that can happen is that your investment will not gain anything, but the possibility of this is very dim.
Upon knowing these factors, you can now make your decision on whether you should invest in one or not. If you decide to invest in one, learn as many things as you can regarding the mutual fund company you want to invest in.
Dont stop researching on mutual funds once you invest in one, continue the learning process so you can personally monitor your investment. It pays to be responsible when it comes to your hard-earned money. - 23210
In a mutual fund company, investors pool in their money to come up with an asset base. A fund manager then becomes responsible with how the assets are to be invested. The fund manager sees to it that the investment portfolio of the company is diversified to ensure maximum gains for its investors. Some of the investments that a fund manager may choose to invest in include stocks, bonds, real estate, and money market investments.
The legal owners of the mutual fund company are the investors themselves. The amount of their ownership depends on the number of shares they bought. This is also the determining factor for the income their investment will bring them. A mutual fund can earn income in two ways. The first one is through the dividends and interests earned by the funds investments. The other way is through the capital gains earned when the cost of security increases. Once the fund gains income, it will then be distributed accordingly to its shareholders.
There are several reasons why mutual funds are popular today. The most obvious one is the minimal investment required. With P5000, the average Filipino worker can now take part of this lucrative industry. One other reason is that an investor wont have to do so much work to see his money grow as a professional fund manager takes care of this. Mutual funds are also easily converted to cash when needed.
Yet mutual funds also have a negative side. The presence of a fund manager can be good, but it also means that you wont be able to take part in the decision-making process. With whatever investment the fund manager chooses to put the funds money in, the only thing you can do is hope that it will yield positive returns for the company. Also, be aware that certain mutual fund companies charge fees. You should take this into consideration as it can affect your investment in the long-term.
In contrast, mutual funds also have its disadvantages. One of which is that you wont be part of the decision making process with regards to how your money will be invested. Since a fund manager is the one who makes this decision, you can just hope he chooses the right investments for the mutual fund company. The worst that can happen is that your investment will not gain anything, but the possibility of this is very dim.
Upon knowing these factors, you can now make your decision on whether you should invest in one or not. If you decide to invest in one, learn as many things as you can regarding the mutual fund company you want to invest in.
Dont stop researching on mutual funds once you invest in one, continue the learning process so you can personally monitor your investment. It pays to be responsible when it comes to your hard-earned money. - 23210
About the Author:
The author's website provides information about mutual funds Philippines and also guide you on how to buy mutual funds in the Philippines.
posted by X - Men @ 4:01 AM
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