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When investors plans to make investments to increase returns on their savings at a given risk level, the Unit Trust is a convenient way to proceed. The investor can having identified his goals have the ability to approach investments in one of the following manner:
Invest a lump sum in one of the selected Unit Trust
Invest parts of the lump amount in few selected Unit Trusts. For example, 80% in income fund and the balance 20% in equity fund.
Invest regularly in selected fund/s, say monthly, quarterly, half yearly, or any other manner.
Automatic dividend reinvestment plan where the dividends from the fund is reinvested in the same fund or any other type of fund. This would help to diversify in the market over time.
Selected scheme offered by a fund management company where the investment is automatically spread among selected funds.
The fund management companies also offer a switching facility from one fund to another without any additional charge. Using this method the investor can time the market himself. When the equity market is overheated, the investor can move funds into the fixed income market through an income fund or otherwise. This process can be used effectively in the life cycle of an individual where the risk taking capacity reduces with the age.
The steps involved in selecting and investing in a Unit Trust can be summarized as follows:
Initial pocess
Identification of personnel investment needs in consultation with an advisor who can understand your personnel investment needs and provide a viable solution. For example retirement, child education/ marriage, to build a house etc. and selection of appropriate type of Unit Trust for investment.
Determine the amount of money you can invest immediately or periodically.
Select the fund management company after evaluating their funds and track record.
In evaluating the funds, you can ask the fund management company to provide you with the Explanatory Memorandum and an application form to open an account.
When you open an account you may be called upon to invest the minimum amount or more applicable to the respective funds. You may be permitted to use same account to invest in to other funds of the same fund management company. It is also required to submit a copy of your NIC/ Passport and other supporting documents to establish the residency of the investor. Alternatively you can buy units of a listed fund into your CDS account.
http://print.dailymirror.lk/business/127-local/46725.html
Invest a lump sum in one of the selected Unit Trust
Invest parts of the lump amount in few selected Unit Trusts. For example, 80% in income fund and the balance 20% in equity fund.
Invest regularly in selected fund/s, say monthly, quarterly, half yearly, or any other manner.
Automatic dividend reinvestment plan where the dividends from the fund is reinvested in the same fund or any other type of fund. This would help to diversify in the market over time.
Selected scheme offered by a fund management company where the investment is automatically spread among selected funds.
The fund management companies also offer a switching facility from one fund to another without any additional charge. Using this method the investor can time the market himself. When the equity market is overheated, the investor can move funds into the fixed income market through an income fund or otherwise. This process can be used effectively in the life cycle of an individual where the risk taking capacity reduces with the age.
The steps involved in selecting and investing in a Unit Trust can be summarized as follows:
Initial pocess
Identification of personnel investment needs in consultation with an advisor who can understand your personnel investment needs and provide a viable solution. For example retirement, child education/ marriage, to build a house etc. and selection of appropriate type of Unit Trust for investment.
Determine the amount of money you can invest immediately or periodically.
Select the fund management company after evaluating their funds and track record.
In evaluating the funds, you can ask the fund management company to provide you with the Explanatory Memorandum and an application form to open an account.
When you open an account you may be called upon to invest the minimum amount or more applicable to the respective funds. You may be permitted to use same account to invest in to other funds of the same fund management company. It is also required to submit a copy of your NIC/ Passport and other supporting documents to establish the residency of the investor. Alternatively you can buy units of a listed fund into your CDS account.
http://print.dailymirror.lk/business/127-local/46725.html
