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Investing your money can be a daunting task, especially if you are new to the investment world. One question that often arises is whether it’s better to invest in individual assets or managed funds.
While both options have their advantages and disadvantages, in this article, we will explore the benefits of investing in managed funds over individual assets.
What are managed Funds
Managed funds, also known as mutual funds, are investment vehicles that pool money from multiple investors to purchase a diverse range of assets such as stocks, bonds, and real estate. The fund is managed by a professional fund manager who makes investment decisions on behalf of the investors.
Actively or Passively Managed
Broadly speaking, there are two types of managed funds. Actively managed funds and passively managed funds. Actively managed funds are managed by a professional fund manager who actively buys and sells assets to try and beat the market and achieve higher returns. Passively managed funds, on the other hand, track a market index and do not try to beat the market.
While both actively managed funds and passively managed funds have their advantages, actively managed funds generally charge higher fees and offer higher returns, greater flexibility, and better risk management.
Here are some of the advantages of investing in managed funds:
In conclusion, investing in managed funds has several advantages over investing in individual assets. Managed funds provide diversification, professional management, lower costs, liquidity, and convenience, making them an attractive option for many investors. However, as with any investment, it’s important to do your research and choose a managed fund that aligns with your investment goals and risk tolerance.
About the Author: Patrick Woodcraft
As a wholesale investment specialist, I help Certified Financial Planners and Qualified Financial Advisors with the information and education they need about investment funds that are poised to perform best for their clients through the volatile economic seasons ahead. Book a free 15 minute discovery call with me to see what value I can bring to your business and establish if we’re a good fit to work together.
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*Patrick Woodcraft does not provide financial advice or investment advice. Nothing on this website may be construed as financial advice or investment advice. Read the full disclaimer here.
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