The return on mutual fund investments may not be that great. However, with the right strategy and execution, mutual funds can be profitable investments.
To be financially independent, it takes more than just a large amount of savings. Valuable assets owned must also be maintained and even developed with investment. Today, there are many profitable investment instruments that can be purchased. But for those of you who are new to the investment world, mutual funds can be a starting point to start investing.
Mutual funds are one of the most profitable investment instruments for novice investors. Compared to time deposits, mutual fund interest is relatively higher. The risk is also lower when compared to stock investments. However, in order for the return to be maximized, you must know how to invest optimally.
- Start Investing with Small Amount
Investing is a risky activity. There is a risk of decline or even loss of value. If you are new to investing in mutual funds, it is highly recommended to start with a small nominal.
Starting to invest from a small nominal gives many advantages. Since the amount of money invested is small, the risk borne is also low. So even if there is a decrease or loss of value, it is still within tolerance limits.
There are many types of mutual funds. From money market mutual funds, fixed income, mixed to stocks, each type of mutual fund has a different level of risk. Choose mutual funds with the lowest risk. Here, you can start with money market mutual funds.
- Always Learn and Improve Knowledge About Mutual Funds
Knowledge of mutual funds must be continuously improved. After understanding what mutual funds are and their types, expand your knowledge by learning things related to mutual funds. For example, such as studying the factors that affect the ups and downs of mutual fund values.
Due to the different asset compositions, each type of mutual fund also has a different character. When one type of mutual fund shows a significant increase, it is possible that a decline in value may actually occur in another type of mutual fund. By consistently increasing your knowledge of mutual funds, it will be easier for you to manage and grow your funds.
- Improve Investing Experience
There are some things that can only be learned by experiencing them firsthand. Through experience, the knowledge that has been learned will be confirmed. But if there is some knowledge that is no longer updated, this is the time to fix it.
The experience of investing will open up knowledge that was previously only limited to theory. How to screen mutual fund products, what components need to be considered before buying a mutual fund product to procedures for buying mutual funds, all of that can only be learned by doing it.
In addition, the large number of mutual fund products available can also be a problem in itself. There are only four types of mutual funds. However, considering the number of investment managers who offer mutual fund products, there are many mutual fund products available in Indonesia. In order to know which product to buy, you should try investing. In this way, you can find out the characteristics of mutual fund products.
- Minimizing the Cost of Investing
Buying and selling mutual funds is basically not much different from buying and selling goods in general. Each mutual fund product has its own price. But when buying a mutual fund product, don't just focus on the price. Also pay attention to the fees .
There are at least three fees or fees attached to buying and selling mutual funds, which include buying fees, selling fees and switching fees . The amount of this fee varies greatly depending on the type of mutual fund product and the policies of the mutual fund issuer.
However, there are also several types and products of mutual funds that have no fees or, at least, will only be charged under certain conditions. If possible, look for mutual fund products that have no fees or low fees . Also, don't buy, sell or switch too often .
- Choose Mutual Fund Products that Fit Your Needs and Ability
Profitable investment orientation is not always associated with high annual returns. Keep in mind, the annual return is basically an average number. So it is very possible for a mutual fund product to experience a significant increase in value in certain years but actually fall in another year.
In order to enjoy investment returns, choose a mutual fund product that suits your needs and abilities. Investments for the purpose of preparing children's education funds are different from investing in pension funds. The mutual fund products that should be chosen are also not the same. Therefore, be sure to determine your investment goals before starting to buy mutual funds. For that, you need proper planning.
In this case, HSBC Premier is here as a solution for planning your financial future. You can find various conveniences in realizing your goals and dreams here. You can get various benefits ranging from an international standard relationship manager, financial needs analysis, comprehensive fund management solutions to a Wealth Dashboard to make it easier to monitor your Wealth Management portfolio.