Tuesday, February 14, 2012
Mutual Funds - Start from Scratch
I started my first investment venture on Mutual Funds when I attended Kerygma Conference on Araneta (now Smart-Araneta Coliseum) back 2008. ATR Kim Eng was one of the sponsors of the event that time and they were giving out flyers about investing in Mutual Funds. Curious about this investment, I bravely get my piece of flyer and all I had to do was fill out the application form on their booth during the break. I want to engage in an investment where my money will be properly managed and probably get higher returns, no scams please! And I finally found what I am looking for.
What exactly is a mutual fund?
Mutual Funds are a way for a group of investors to pool their money so they can invest in a wider variety of stocks and bonds. Each investor in the fund gets a slice of the total pie. If you are one of those like me, who wants their hard earned money to profit, you can open a Mutual Fund account, fund it each month or quarterly just like saving in the bank. As low as Php5,000, you can already open an account and deposit additional investment monthly. MFs give a higher return of investment compared with a savings bank account, which is likely less than 1% or a Time Deposit like 3.25% annually taxes excluded.
The group of investors forms a mutual fund and hires a fund manager. The manager makes decisions about how and where to invest the money based on their analysis. They are professional managers, experts and experienced with extensive research about finances.
Before you decide to invest in mutual funds, you must also learn more about the advantages and disadvantages. Returns are not everything, you must also consider the risk to achieve those returns.
Mutual Fund is a risky investment.
To make the wise decision when investing in Mutual Funds, you need to learn and understand the basics. You can visit PinoyMoneyTalk for list of Mutual Funds in the Philippines. It is also best to get in touch with Mutual Fund agents who can explain you further the process for opening an account and how to save regularly.