Investing on your own means that you have full control over your investment choices. However, to manage your investments properly, you need to keep up to date with market movements and legislative changes.

This can be very time consuming and requires a high level of financial expertise. Consequently, many investors prefer to seek professional advice for expert assistance in the selection and management of their investments.

Alternatively, some people choose to put their money into a managed fund – a financial planner can help you choose which one is right for you.

Managed Funds

When investing in a managed fund, your money is pooled with that of many other investors. This enables the fund manager to buy a wide range of assets.

When you invest in a managed fund you’re issued with a number of units. These represent your ownership in the fund. As the performance of the fund varies, the value of your units will fluctuate in the same way that share prices fluctuate.

The benefits of investing in a managed fund include:

• diversification - the opportunity to gain access to a wide range of assets with a relatively small amount of money;

• greater buying power - access to assets which would normally be beyond your reach, such as an overseas company or a large shopping centre;

• increased liquidity - the flexibility to sell your investment units at any time; and

• professional management - having full time financial experts looking after your investments. This has the advantage of potentially less risk and greater returns.