Managed Fund
What is a managed fund?
A managed fund is a pooled investment vehicle that enables investors to access a diversified portfolio of assets managed by professional fund managers. Managed funds typically invest in a range of asset classes, such as equities, fixed income, and alternative investments, providing investors with exposure to a diverse range of investment opportunities. Managed Funds have some form of philosophy or backbone behind the creation of the type of fund.
You as an investor do not own the underlying investments, you instead own units proportionate to the amount of money you have invested. The value of the unit will rise and fall according to the value of the underlying assets within the Managed Fund. Investors receive pay income or distribution along the fund period.
Why managed funds?
Managed funds are a great option for investors who want to access a professionally managed portfolio of assets without the time and expertise required to manage their investments directly. Additionally, managed funds allow investors to benefit from economies of scale, as the fund's assets are spread across a broad range of investments, reducing overall risk. With the potential for long-term growth and a variety of investment options available, managed funds are an attractive investment option for individuals looking to achieve their financial goals.
Benefits
- Broad Investment Opportunities across a range of instruments.
- Diversify your investment portfolio across countries, asset classes, industries, and companies to reduce the impact of fluctuations in an investments market value. Spread out the level of risk in your investment portfolio.
- Professional Management is included as part of being a Managed Fund. They are managed by a team of professionals who have access to research, market data, and investment tools that individual investors may not have.
- Accessibility of Managed Funds is remarkably high with a low investment amount required to take part, making them a more accessible option for investors without easy access to individual stocks or bonds.
Risks(including but not limited to)
- The value of the Managed Fund can fluctuate based on market conditions, and there is no guarantee that the fund's investments will performs as expected.
- The performance of a Managed Fund is dependent on the skill and experience of the fund manager. If the manager makes poor investment decisions, it can negatively impact the fund's returns.
- Managed Funds can have various fees and expenses associated with them such as, management fees, performance fees, and transaction costs which may eat into an investors returns.
- Depending on the structure of the fund, there may be a certain level of illiquidity as it may not be easy to redeem your investment quickly.
Key Features
| Estimated Yield P.A | Consult Your Financial Advisor |
| Duration | 3-12 Months |
| Risk level | Low-medium |
| Focus of investment | Income |
Types of Managed Funds
Property Funds
A property managed fund is an investment fund that invests in a portfolio of income-producing real estate properties. The properties that are included in a property managed fund can be either residential or commercial, and can include office buildings, retail centers, industrial facilities, and residential complexes. The fund earns income from the rent and lease payments made by the tenants, and may also earn capital gains if the properties are sold at a profit.
Equity
An equity managed fund is a type of investment fund that invests primarily in equity securities, such as common stocks or preferred stocks. Equity managed funds can be further categorized based on their investment style, such as growth, value, or blend. Growth funds focus on companies that are expected to have high earnings growth, while value funds invest in companies that are undervalued by the market. Blend funds combine both growth and value investing strategies.
Bonds Funds
A bond managed fund is a type of investment fund that invests primarily in fixed-income securities, such as bonds, treasury bills, and other debt instruments. Bond managed funds can be further categorized based on the type of fixed-income securities they invest in, such as government bonds, corporate bonds, high-yield bonds, or municipal bonds. They can also be categorized based on their investment style, such as active management or passive management.
Mortgage Funds
A mortgage managed fund is an investment fund that invests in a portfolio of mortgages on behalf of its investors. This fund can include residential or commercial and can be either first or second mortgages. The fund earns income from the interest and principal payments made by the borrowers, and may also earn capital gains if the mortgages are sold at a profit.
Looking for More Funds?
We can help you find a Managed Fund that is tailored to your situation, needs and risk levels. LindaleSolomons can highlight the different investment philosophies of various fund managers to help you reach your investment goal and fit your specific criteria.
