Friday, June 3, 2011

Should You Invest in Unit Trust?

Unit trust or mutual fund is a financial vehicle through which individuals may invest their money. The idea behind unit trust is better returns through collective investing. In other words, it means pooling the investments of many investors, individuals and institutions.
Unit trust is getting popular nowdays due to potentially higher return when compare to fixed deposit or EPF saving. Furthermore, EPF is providing an option to withdraw some or your EPF saving for the purpose of investing in unit trust.
If you still wondering whether to invest in unit trust or not, you should see the reason why you should.
  1. Being well-diversified financial instruments, they are less risky than if you were to invest in individual stocks.
  2. You can reap investment opportunities from all over the world, as they are invested globally and into different financial instruments.
  3. They are managed by professional fund managers who aim to obtain higher returns for your money. You do not need to monitor equity markets closely for fluctuations.
  4. There is a wide selection of unit trusts available to meet the different investment objectives of investors. Staying invested over time, these returns can compound to very attractive amounts, unlike savings deposits.
  5. Fund houses are bound by agreement to purchase the unit trusts back from you should you decide to sell your holdings, at the prevailing price on the date of sale, regardless of the number of units sold. Liquidity gives flexibility.
Source : FundSupermart

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