Investment funds have become one of the preferred financial tools for small investors to make their savings profitable. Especially in recent months and as a consequence of the low profitability presented by the main banking products (deposits, bank promissory notes, public debt, national bonds, etc.), given the cheaper price of money by the European Central Bank (ECB ). They do not offer an adequate return for your interests as small savers, where they rarely exceed the meager 1% barrier.
Faced with this monetary scenario, and the risks involved in investing in equities, many of the savers (the most defensive), among which you can be yourself, They have turned their sights towards investment funds as a formula to increase their personal assets, without exposing themselves to excessive risks.. Basically for many reasons that underpin the choice of this investment model.
One of them is the great modality of formats that you can formalize from the funds: fixed income, variable, mixed, and even alternative. But they go further, when the management companies make them, with greater protection and interest so that they are signed by client as in your case. From flexible, even with the euro covered, and with a whole series of commercial strategies that have convinced a good number of savers to make their monetary contributions.
Is it advisable to carry out these operations?
Unlike traditional fixed income products, they do not offer you a guaranteed return, not even in those based on financial assets not from equity markets. Nevertheless, they have usually been generating an average yield that is between 3% and 10% in recent years, depending on their nature and exposure to the main financial assets.
And that in the specific case of those linked to the stock markets can skyrocket if conditions support it. Either way, it is convenient that you know, not that their profitability is guaranteed, but that they can even generate significant capital gains.
While It is not a recommended product in the short term by its very nature, it does point out a series of advantages that can make it very suitable for your interests, if you want to obtain a benefit from your life savings. Generally they are derived from their special contracting conditions, and reaching a better tax treatment through the transfers that you make between them. Instead of selling them and having to meet the expenses, you can transfer them to other funds, in order to settle the operation without tax outlays.
But the most interesting thing for you is not the profitability that they can generate through their hiring, but the great money savings that you can get if you know how to manage them correctly. And that affects both their commissions and the transfers that can be made between them.
Even many banks offer you the possibility of taking advantage of interesting promotional offers for bringing funds from other entities, even proposing cash for you to accept the operation. It won't be much, but you will surely have what it takes to pay yourself a little whim.
From savings in its management, to the elimination of the main commissions are just some of the advantages that derive from its hiring. And especially if they are compared with other products, both for equities (stock market, warrants, derivatives, etc.), and for fixed income (time deposits, corporate bonds, bank promissory notes, etc.).
What commissions will you have to face in a fund?
Unlike traditional equity investments, mutual funds can have more than one commission That they can charge you at the time of formalizing it, and until its liquidation. In any case, you cannot get one of them out of the way in any way. It is about the management that the manager will charge you for its administration, which will always appear among its conditions. It will be through a fixed percentage that will generally be applied to your invested capital, although in some situations it is established on the profits accumulated in the fund. It moves in a range that goes from 0,50% and with a maximum of 2%, depending on the chosen model.
But there are others that can make this financial product more expensive. And among the most common, the depositories, subscription and reimbursement stand out. But be very careful since lately another one of new stamp has appeared, denominated of success, which can raise your spending up to 20%. If you have read correctly, despite the large percentage.
As a result of the collapse in the price of these products, the managers have tried to give customers greater confidence through this rate. It basically consists in that you will have to pay it if the objectives in its performance are achieved. In this way, if you generate capital gains, you will do very well, but you will have to face very harsh conditions. In return, if you do not get benefits you will not have to pay this commission.
Deposit commission: it will be the bank itself who retains it, but not in all situations, and in any case under softer margins than in the other rates. They are derived from the maintenance of these banking products.
Subscription fee: It is not usual for them to be charged on account, but you should know that it is generated at the precise moment in which you formalize the subscribed fund, that is, at the beginning of the operation, and its amount is not very high.
Refund commission: it is the amount that emerges when the invested capital is reimbursed, and as in the previous cases, it is not very frequent that they are applied to you. Always under acceptable margins for your interests.
In any case, and although each investment fund has its own commissions, these cannot exceed a maximum scale that applies to all investment funds, whatever their nature and composition.
Anyway, the most expansive is the one that affects subscription and redemption operations, which under no circumstances can they charge you more than 5% on the capital you invest. On the contrary, in the usual ones they move under more bearable percentages for your pocket: deposit (0,20%) and management (2,25%).
You can make unlimited transfers
Investment funds It is not a product to have it for a few weeks and switch to another. Of course not, since the recommended terms of permanence pass for a minimum of 2 or 3 years, where its effectiveness in improving savings becomes clearer. As stated by the managers of these financial products.
However, there are situations where a substantial change in the investment portfolio will be necessary, to try that its performance is higher, and can be adjusted to all the situations generated by the financial markets. In any case, there are several scenarios that are most likely to make these operations effective among investment funds.
- Faced with an obvious error in our fund selection process, and that will require a timely and urgent rectification of the same.
- In changes of economic cycles, or simply temporary, which will require other more appropriate models with the new situation, even varying their management.
- In situations, in which its evolution - for several months - does not meet the expectations created, and a change is needed in the composition of our fund portfolio.
- When financial market conditions require vary the management model, for example, going from an equity fund to a fixed, mixed to variable, etc.
How to save money on your hiring?
If you manage these investment products correctly, you will obtain many benefits, since it is a model that is very open to the different profiles of savers. And that knowing how to choose them can save you almost 1% in commissions.
The great offer that these products present also help to design a strategy to meet these objectives, and that you only dedicate yourself to choosing the best models in terms of performance that they will provide you for the next few years.
Starting from these variables, it will be necessary that from now on you import a series of tips that will be very useful to make up your investment portfolio. And if you have any doubts, you can consult your usual bank, which surely has a service of professionals who will surely solve the doubts you have about this product.
- In the face of funds with similar characteristics, you should opt for what includes the least expansive commissions and expenses. This operation will help you to make greater profits in each operation that you develop.
- Analyze each fund in depth, to check what kind of commissions you will have to pay. It is probably more than one, especially in those from equities.
- You can find fund, with excellent performance, that are marketed under minimal commissions, around 0,75%.
- See the offer of funds presented by the bank with which you operate, because their commissions are probably not that high.
- Its convenient that have all these products contracted in the same bank, because in this way you can make unlimited transfers, without any economic cost to your interests.
- You should know that the commissions, generally will be discounted from the prices of their securities, and in no way on the amount of the operation.
- It will be more profitable than opt for national funds, since they can be equally profitable, but with less expansive commissions.