Choosing The Right Investment Funds For Your Needs

When you are selecting the types of investments that you want to include in your portfolio, there are a number of considerations that you will need to make. Very often, the purpose of your investments will be to provide you with an income for some point in the future, usually your retirement when you will no longer have an income from working. There are many different types of investment funds out there and the wide range of choice that there is available can make choosing the right investments for your needs difficult.

Open Ended Investment Companies (OEICs)

Investing in an OEIC involves buying a share of the company itself. The money raised from the sale of these shares is then used to buy stocks and shares, equities and property. The share price of the company is linked to how well these investments perform. This type of fund is ideal for people who want to invest in the stock market but are either not sure how to get started or who do not want to invest in the stock market directly.

Unit Trusts

These funds are very similar to OEICs in that all the money that is invested by individuals is pooled together and used to buy shares. Again this means that investors do not have to buy shares directly and that they are less exposed to risk. The main difference between unit trusts and OEICs is that unit trusts are more legally complex to manage and this is one of the main reasons why OEICs have become a more popular alternative in recent years.

Offshore Funds

The main advantage of an offshore fund is that tax is not payable on the gains, which means that any profit that is made on the investment can be reinvested without you having to pay any tax on this profit. However, when you come to cash this investment in, tax will then be payable on any profit that has been made. However, the company that is managing the fund will be able to advise you on the amount of tax that needs to paid and may also be able to provide information on how to pay this tax and when it needs to be paid by.

Ethical Investment Funds 

Ethical investment funds will only make investments that are based on certain criteria regarding ethical and environmental factors. The company that manages these funds will usually have a specific team that deals with ethical investments and they will ensure that any investments that are made on your behalf meet the criteria that the company has in place. They should monitor these investments to ensure that they continue to meet the standards set by the company.

The type of investment funds that are chosen will depend on your personal financial goals and what you want to achieve from your investments. You will need to decide how much risk you want to take with your investments and the length of the investment term before choosing a fund to invest in. You may also want to ensure that any investments that the fund makes are based on your own ethical principles. The company that manages the investment funds should be able to provide you with all the information that you need before making a final decision about which fund to invest in. They should also be able to answer any questions that you have before the final decision is made.

Leave a Reply

Tweet
Share
Share