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 laymans explanation, mutual funds can be understood as a fund which has an asset base jointly put up by different shareholders which is then invested into several diverse investment vehicles. A fund manager is designated to do all the decision-making regarding the kind of investments the fund will be put into. Invariably, he sees to it that the funds investments will gain maximum returns for the shareholders.
Mutual funds earn income in two ways. One is when the value of security assets increase which is commonly termed as capital gains. The other one is through the interests and dividends earned from the other investments of the fund. Upon earning income, it will then be divided among the shareholders according to the number of shares owned.
There are two ways a mutual fund can generate income. The first way is through the dividends and interests accrued from the funds investments. The second way is through capital gains, which occurs when value of security investments increase. Once gains are earned, it will then be passed on through the shareholders by distributing it according to the amount of ownership.
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. - 23222
In laymans explanation, mutual funds can be understood as a fund which has an asset base jointly put up by different shareholders which is then invested into several diverse investment vehicles. A fund manager is designated to do all the decision-making regarding the kind of investments the fund will be put into. Invariably, he sees to it that the funds investments will gain maximum returns for the shareholders.
Mutual funds earn income in two ways. One is when the value of security assets increase which is commonly termed as capital gains. The other one is through the interests and dividends earned from the other investments of the fund. Upon earning income, it will then be divided among the shareholders according to the number of shares owned.
There are two ways a mutual fund can generate income. The first way is through the dividends and interests accrued from the funds investments. The second way is through capital gains, which occurs when value of security investments increase. Once gains are earned, it will then be passed on through the shareholders by distributing it according to the amount of ownership.
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. - 23222
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 @ 5:55 AM
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