Unit trusts are transparent, well regulated and easy to understand. We’ve outlined the top ten reasons why you should invest in unit trusts:
Diversification
You don’t want to have all your eggs in one basket and unit trusts allow you to spread your risk across investment managers, asset classes and investment styles. This helps improve your chances of good returns and reduce risk. Unit trusts are often referred to as “collective investments” and buying a collection of investments is generally safer than buying a single investment.
A professionally managed investment portfolio
By investing in a unit trust fund you can create wealth by tapping into the expertise of South Africa’s top investment managers irrespective of how much you have to invest. Active and professional management aims to maximise your returns, whilst minimising risk.
Liquidity – quick and easy to invest and sell
A unit trust portfolio is a flexible investment. You have access to your money at any time, should you need it for a rainy day. On Investonline’s platform, your money is always accessible and you can withdraw unit trust investments (convert them back into cash) whenever you need the money.
Unit Trusts to suit your specific risk profile
There are over 1000 unit trusts in South Africa, ranging from conservative to aggressive and sometimes the amount of choice can be overwhelming. To find out which portfolio of premium branded unit trusts best suits your investment strategy, simply do the risk profiler. You also have the ability to tailor make your own portfolio of unit trusts.
Offshore exposure
Unit trusts offer direct offshore and currency investments. They allow an alternative way to invest offshore without using your offshore allowance. Many South Africans remain nervous about moving their money overseas, preferring to rather use local fund managers with the ability to invest internationally.
Tax efficiency
Unit trusts are tax efficient and convenient, especially if setting up a retirement annuity.
Transparency
Unit trusts have transparent product fees, no penalties for surrender or discontinuation and no fees for switching or transacting.
It is easy to monitor
With unit trusts it is very easy to monitor what the units are worth and therefore how your investment is performing. Units are priced daily and you can track your investment performance and compare unit trusts on a daily basis. You can login to your Investonline online account to easily see exactly how much your investment has grown.
Outperformance
Most premium brand unit trusts have outperformed the market over time. Over the past year, Investonline’s aggressive portfolio returned 28.29% which outperformed the All Share Index by 5.54% (Data as at 31 October).
Investor protection
Unit trusts are governed by a well regulated industry.
For more advice or for assistance in setting up an investment portfolio, please call us on 021-794 2469 or email us at info@investonline.co.za