Benefits of investing in mutual funds
Mutual funds have always been highly popular among old and new investors and yet still show a promising trend of future expansion. One might wonder how come mutual funds can still maintain their popularity nowadays despite more financial tools and investment options have been available.
Here are some of the benefits that mutual funds have which attract investors seeking to maximize their profits.
1. Small capital required
Mutual funds nowadays require smaller minimum investment capital compared to other investment options, which means anyone can start investing regardless of their financial status.
2. Variety of investment options
Mutual funds offer several financial products that suit the varied needs of investors. You can choose from a wide range of options such as fixed-income funds, technology funds, gold funds, health technology funds, clean energy funds, and more. Investors can choose the funds in the sector that they are interested in, or distribute their capital across several funds to achieve the profit target.
3. High cash flow
Mutual funds have a shorter period for redemption of unit trust, which allows investors to faster regain their capital for future investment and therefore maintain a high cash flow.
4. Double the profits with tax benefits
Mutual funds such as SSF (Super Saving Fund) and RMF (Retirement Mutual Fund) grant investors tax deduction benefits provided that they meet the investment requirement. SSF requires about 10 years of continued investment while RMF investors must hold the unit trust until they are 55 years old before they can be sold. Investors therefore are advised to study the criteria and requirements of each fund carefully.
5. Equally supervised by experts
No matter how small you invest, every mutual fund will be professionally managed by ‘Fund Managers’ who are well-versed in asset management while your profit will be handled by ‘Trustees’ who work to ensure the funds’ transparency and maximum profits for investors. This has made mutual funds a hassle-free investment whereas investors have the freedom to focus on their work or things they love.
6. Diversified investments
As mutual funds pool capital from several investors, they will need to distribute the investments across different assets to maximize the profits and minimize the risks throughout the investment period, depending on each funds policy. This helps investors save time in analyzing different assets as well as in dealing with organizations that they need to invest in.
7. DCA friendly
Mutual funds are suitable for Dollar Cost Average (DCA) approach, which is a strategy to invest regularly and continually at equal amounts in long term. Since mutual funds require a small starting investment, supervised by professionals, and have diversified investment, investors can therefore rest assured that they can stay on track under the DCA approach until they achieve the desired target.
Principal Asset Management, a subsidiary of Principal Financial Group, is a world-leading asset management company trusted by over 45.5 million investors worldwide and has accumulated over US$ 990.4 million of capital (as of June 2021). We have selected premium funds in different sectors such as bonds, equity, property funds, foreign investment funds, and more for investors to choose from in order to achieve their financial targets.
Read more about mutual funds at https://www.principal.th/en/mutual-fundth
Investors should study the conditions, returns, and risks of the funds before investing. Past turnover does not guarantee future turnover.
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