The Advantages of mutual funds.

[Wiserr]

ADVANTAGES OF MUTUAL FUNDS

1. Low Initial Investment
- It takes only P5,000 (or P1,000) to start in mutual Fund investing. After that, you can invest P1,000 (or P500) every month or every other month, or as often as you want.

2.Diversification
-Mutual Funds allow small Investors to take advantage of investment opportunities with a bigger interest and enable them to buy more types or unit of investment, instead of being limited to only one or few.

3. Convenience and Cost efficiency
- Mutual Funds take the stress away from small investors who want to invest in the financial markets. This is because MF are handled by competent and professional fund managers who choose the right investment for them.

4.Principle of Compounding at Work
-The earnings of a Mutual Fund grow more when the value of the securities it owns increases. Compounding automatically takes place while the investments remain in the Mutual Funds.

5. Liquid Investment
- This means you can get your cash easily if you need it. Mutual fund shares can be sold (redeemed) and collected within seven banking days at the prevailing NAVPS.

6. No more tax and additional charges
- Mutual funds invest in stock and securities that are already subject to final withholding tax. Therefore, investors' earnings in mutual fund are no longer subject to tax.

 

[Jasmine]

When you invest i share market, your $100 investment can be $50 just in few days, however, when you invest in mutual funds, your $100 investment with 20 percent return for the period of 5 years will surely give you returns. This is the main attraction of mutual funds. However, before you invest in mutual funds, you need to do some research and check whether the promoter is a legit company or not, whether the return is unrealistic or not, etc.