Areas of Consideration in Investing in Unit-Trusts

Unit Trust offer significant benefits, but you should also be aware of the following considerations.

You can be overwhelmed by the availability of funds offer to you. If you invest indiscriminately, you could end up with an assortment of unit trusts that do not match your needs. Thus, you must be clear about your investment objectives and then decide on the suitable unit trust.

The fees you pay for investing in unit trusts can eat significantly into your returns. These fees may also includes high transaction costs so investors should be aware. You should inquire about the type and amount of fees applicable to a particular unit trust. You Independent financial advisers (IFA) will be ready to provide you the service in getting the information to you..

The selection of the fund manager is another important consideration. You will need to assess whether has the resources, experience and skills to do a good job of managing the fund. Once the investment is made you still need to monitor the performance to see if it is meeting your expectations.

Good recent performance of a unit trust may attract you to invest in it. This may not be advisable however since it is difficult to judge consistency over a short period. Consistent good performance over a longer period is a better guide to the quality of the fund manager, but even then it must be noted that past performance is not necessarily a good indicator of future performance.