One of the most diversified products that you can contract at the moment are investment funds. But you should know that they are of a great nature, as many as there are many financial assets. In any case, one of the most forgotten by small and medium investors are mixed. It is an investment model that combine several financial acts with each other, both from equities and fixed income, without forgetting alternative or even monetary positions. In this sense, it is a very complete fund that covers several forms of investment, without you having to hire more products.
From this general scenario, it is one of the most defensive solutions to the instability that financial markets are presenting these days. Among other reasons because they incorporate shorter durations with regard to the part of the fixed income. For a very clear reason and that is none other than the foreseeable rate hike that looms in the euro zone. In this way, one of the first effects that this kind of funds generate is that it protects your savings more. In the sense that losses are significantly limited, if any.
It is a product that is adapted to all investor profiles. From the most aggressive to the most defensive cut, with practically no limitations in terms of its potential recipients. Although it is the most conservative savers who in the end opt for mixed investment funds. Especially because it allows them to diversify their capital or assets much more effectively. From different approaches to investment that you can select to your liking. Not in vain, they have a very powerful offer that has been selected by all kinds of national and international managers.
Mixed funds: they are more flexible
Why can this type of fund be very interesting to subscribe right now? Well then, because your versatility and flexibility makes them one of the most suitable categories in the current environment of financial markets. Where, equities are showing worrying signs of weakness and fixed income is not what it was a few years ago. With the risk that you can leave a lot of euros on the way. From this global environment, mixed investment funds significantly reduce risks. Although on the contrary, they limit the possible gains that you can obtain in the expansive scenarios of the economic cycles.
What do you really get when you hire these investment funds? Well, something as simple as opening a more defensive position to the markets because you are going to choose reduce its weight in equities and reducing durations in the fixed income part due to the risks of rate hikes. As you will have seen, there are many advantages that these can bring you products financials in a scenario like the current one. Where, on the other hand, you don't know what to do with your money. Because the stock market does not convince you and fixed income is full of a series of risks that were unimaginable until a few years ago.
Products of a different nature
Of course, there is one thing very clear in mixed investment funds and that is that within them, we can see the different strategies that can be used in the investment world. Even from very innovative models that may even surprise you with its novelty and originality. In proportions that will be aimed at the profile you present as a small and medium investor. That is, with a moderate risk or assuming more aggressive approaches. But in all cases, diversifying investments, which is what defines these special products that we are talking about.
In another vein, you cannot forget that mixed funds help you to graduate the beta and the risk in the portfolios. This in practice is substantiated in that peak losses are usually controlled and they are usually good portfolio mixers. Where you yourself will not have to do anything, but on the contrary everything will be done for you from the management companies themselves. Who are the ones who choose which financial assets are the most appropriate to make profitable customer savings. Some of them with an annual return that can even reach double digits. At least it will give you to think about whether or not it is worth its formalization from now on.
Complement to the investment portfolio
In any case, mixed funds are a good complement to any investment that you have developed up to now. With exposures to equities, currencies, raw materials, etc. That is, you will have a lot of flexibility to develop the decision you have made when opting for one of the products with these characteristics. Of course, more in the more traditional models that are based directly on equities or fixed income. Not surprisingly, it is one of the great advantages of betting on this investment model at the moment.
On the other hand, those called as mixed will generate that you can be something calmer in the face of possible instabilities of financial markets. As it is happening in these months and that is creating the indefiniteness of a good part of the investors. As it can be in your own case when you are afraid of what may happen with the always complicated world of money. In this sense, mixed investment funds give you much more security than the rest. But be very careful, because they are not without risks. Not much less, as you can foresee from these explanations.
Intended for the long term
Regarding the long term, there is no doubt that the combination of several financial assets contributes a solid consistency adding value to portfolios. Of course, its effectiveness in the shortest terms is more limited than in other types of investment funds. Because their strategies are more complicated to develop due to the special characteristics of these models to make your personal assets profitable. That is to say, they are intended for periods of a few years ahead and that can help you eliminate tensions in the preparation of an entry into the financial markets.
In any case, you will always have the possibility to transfer your mixed investment funds to other management models. An advantage of this strategy is that you can apply this system unlimitedly, that is, how many times you want depending on your personal interests. Because it will also have no monetary cost, since quite the opposite you will not have to pay a single euro in these operations. The origin of the funds does not matter since the only requirement is that the funds are deposited in the same bank. And direct it to the fund that you consider appropriate, whatever your nature.
They are funds that are more controlled
If these financial products are characterized by something, it is because you can exercise greater control over their positions. It is a contradiction, but this is because its oscillations are less than in investment funds based on variable or fixed income. Not surprisingly, volatility is significantly lower since it is very rare for it to have very violent fluctuations. From this scenario, they are products that can be considered as more stable. Something that does not mean that they are exempt from losses in their price. Of course not, as you can see with the evolution of these models in money management.
With various commissions
Another consideration that you should take into account now is that your hiring entails the payment of several commissions. As with the remaining investment funds, although in any case it is very strange that they exceed 1,50% on invested capital. The commissions of these financial products are in line with those derived from the purchase and sale of shares on the stock market. And more expansive than in exchange-traded funds that are better known as ETFs. In this sense, there will be no significant differences with respect to other forms of investment.
You should also bear in mind that they are penalized for their tax treatment. This really means that when you recover your financial contributions with their corresponding interests, they will deduct your taxes. That is, the gross return will not go to your savings account. Therefore your best strategy is based on keeping mixed funds for a longer term to try to compensate for this tax procedure.
From this perspective, it is not one of the most recommended products, but it is adapted to very specific recipient profiles. In any case, it is another of the alternatives that you have at the moment to make the savings profitable. Although from a more innovative approach than from other steps that you have before you. With a wide variety of models that will be adapted to each of the profiles of small and medium investors. Beyond other technical and maybe even fundamental considerations. From now on you will only have to assess whether or not it is really worth doing.