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Picking Good Managed Funds

Investment Articles > Article: Picking Good Managed Funds

Selecting good Australian managed funds depends on many factors, including your knowledge of financial markets, the amount of disposable income you have to work with and your ability to follow your investment with time.

This article will provide you with some tips that will help you pick good Australian mutual funds so you increase your chances of realizing a decent return on your investment. You don't have to follow all of the advice on this page, but if you adopt one or two strategies you will start to see just how fast wise decisions can have a positive effect on your investment.

Top Tips for Selecting Australian Managed Funds

The first step in selecting good Australian Managed Funds is learning as much as you can about managed funds. If you do not know what managed funds are then you have to learn as much as you can about investing first. It is a good idea to take a refresher financial course or investment class so you know what you are doing before you invest.

Many organizations offer brief one or two hour seminars that often provide lectures on the subject of investment. You can also often find information about mutual funds and investing in mutual funds online. Once you do this, then you can start considering investing.

Here are some steps to follow once you know what mutual funds (investment vehicles) are and how they can help you earn money and eventually retire.

  • First, find a licensed financial advisor to talk with. It is a good idea to talk with friends and family about investments. However, unless one of the members of your circle is a licensed financial advisor, you need to seek one out. The best person to advise you on financial matters is a licensed professional.
  • Next, think about what risk you feel comfortable with. Investing in Australian mutual funds always involves some level of risk. Are you the type of person that wants to invest in high growth mutual funds? That's fine; just realize you are going to have to take on a bit of risk if you do so. If you don't care for risk there are many funds you can invest in that will limit your risk. A diversified portfolio is capable of offering a mix of high and low return mutual funds. This type of portfolio balances out high and low risk funds so your mutual funds tend to perform well without exposing you to too much or too little of anything.
  • Make sure you invest only what you can afford to lose. If you gamble your money away you will not win. Investing in Australian mutual funds is not the same as investing in the lottery for example. This is not the type of industry where you should "gamble" your money away. Most people invest with good intent. They want to build their nest egg to retire or put money away for an important purchase or education.
  • Think about your reasons for investing and then plan accordingly. If you want to retire, then create some goals that center on retirement and ask your financial planner what you can do to make this happen. Your financial advisor will consider important details including your budget, your age and the amount of time it will take to grow your portfolio. Together you can make the right decisions about investing in Australian mutual funds.

Additional Steps to Setting up Good Managed Funds

Many people set up their mutual funds and "forget" them. There are long-term funds that allow people to basically "set and forget". But, there may be times when you want to become a more active player in your investment. There are times for example when the market may be very volatile and when prices fall. This may be a time when your mutual fund also fails you. If this is near a time you plan to retire, you may need to take quick action.

It is always a good idea to keep an eye on your Australian mutual funds. If you suspect things may go awry, and are close to an important anniversary or withdrawal date be sure to read the financial news and talk with a trusted advisor so you can take whatever action necessary to secure your investment. In some cases this may involve transferring your funds to more secure, low return mutual funds. Other times you may need to do nothing but wait, because sometimes such rises and falls set off false alarms. Just be sure you have a backup plan if you need one.

A smart and knowledgeable investor always comes out ahead. It never pays to say "I don't know" when it comes to your mutual funds.

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