- What is an investment fund?
A fund is a portfolio of investments containing various financial instruments, such as equities. It is managed by a professional who invests the fund assets following the fund rules.
In practice, investing in a fund means that you will choose a fund and buy its units. The value of a fund unit is calculated daily in regular funds (UCITS) but more infrequently, such as once a month, in other funds (non-UCITS). Any increases or decreases in the value of a fund unit depend on the performance of the investments the fund makes. This performance, in turn, depends on factors such as the general market situation.
- How can I buy fund units?
You can buy fund units in many different ways – just choose the best one for you!
- If you need tips on how to define your targets and select the best funds for you, you can get an easy start with our digital investment adviser Nora. Nora will suggest the most suitable option for you based on your answers. If you want to get personal advice, you can book a free meeting with one of our expert
More about Nora
By using the Portfolio Designer, you can pick out funds from our fund range. You can also use it to determine your investment profile. Our Portfolio Designer is best suited for experienced investors.
Try Portfolio Designer
- If you already know the funds you want to invest in, you can log in to Nordea Mobile or Netbank and buy fund units. You can find funds in the ‘Savings and investments’ section.
- If you need help in choosing funds or getting started with investing, book a meeting for investment advice and our expert will help you. You should also book a meeting if you want to invest your child’s savings in a fund or set up other saving or investment services for your child.
- How does Nordea account for sustainability in funds?
Our fund range also includes funds that have a special focus on sustainability.
These funds are a good option for investors who want to promote sustainability with their choices. All our funds manage sustainability risks and exclude certain harmful businesses from their investment universe in accordance with our Responsible Investment Policy.
In addition, many of our funds are committed to promoting environmental and social characteristics and/or making sustainable investments. The fund manager will also ensure that the fund’s investments meet any special fund-specific sustainability criteria.
We also have a dedicated team that focuses on sustainable investments and includes analysts who are closely involved in the investment processes of many funds.
The abbreviation ‘ESG’ is often used in connection with sustainability and it encompasses the following aspects:
- Environmental, which includes mitigating climate change, promoting biodiversity and increasing energy efficiency.
- Social, which includes promoting human rights, equality and labour rights.
- Governance, which includes combatting corruption and bribery and a focus on corporate remuneration systems.
We have also ranked our funds based on ESG criteria. This means that when you select your funds, you can also assess how much each fund focuses on ESG issues.
- How are fund investments different from saving?
When you have fund investments, it means that you invest your money in a fund. You can also make a monthly fund savings agreement with us, which means that we will transfer the agreed amount from your account into your selected fund, but this is also ultimately an investment.
One essential difference to saving into an account is that the value of your investments may rise or fall based on market fluctuations. In the worst case, you may lose the entire capital you have invested. On the other hand, the expected return related to investments is better compared to keeping your savings in an account and letting inflation erode their value – especially in the long run.
- Are funds suitable for saving in the short term?
Funds are particularly suitable for investments that you intend to hold for at least three years or longer. Over time, you will benefit from the effect of compounding, which means that you will earn a return on any returns your fund units have accumulated. Time will also help even out any market fluctuations.
If you plan to save for a shorter period of time, our FlexiDeposit Account could be a worthwhile option. Read more about FlexiDeposit Account
- What is unit-linked insurance?
Through unit-linked insurance, you can invest in a wide range of funds and investment baskets and switch between investments under one insurance contract. You will only need to pay taxes on any capital gains when you withdraw all or part of your savings from the unit-linked insurance. In other words, switching between investments is not subject to tax.
- Do I need to pay tax for my fund investments?
Any returns you earn with your fund investments are considered taxable income.
A fund may have unit series with different return distribution qualities, and you can select whether you want to buy distribution or growth units.
- Growth units are ideal for long-term investments, as any returns or taxes won’t materialise until you sell your fund units. This means that the returns gained over the years will also gain returns and accrue the capital.
- With distribution units, returns and taxes are paid annually.
- How much can I gain by investing in funds?
Like all investments, fund investments offer potential returns but also involve risks. We can’t guarantee a certain return on any fund, and past performance is not a guarantee of future results. The value of your investments may rise or fall based on market fluctuations triggered by world events. In the worst case, you may lose the entire capital you have invested.
- Can I buy fund units for my child?
You can invest your child’s savings in our funds if your child has an account with us and all guardians consent to it. When you save for a child, the time period is often quite long, so it may be a good idea to invest the savings in a fund, for example, to enable their value to grow over time.
If you want to start investing in funds for a child, book a meeting with us for investment advice.
Read our instructions, find an available time slot and book a meeting
- How do I know what is the best fund for me?
Different funds contain different securities based on whether their objective is to seek higher returns at a higher risk or lower returns at a lower risk.
When you’re choosing your funds, think about how much and for how long you want to invest and how much risk you are willing to take. Risk and return go hand in hand: the higher the return you seek, the more fluctuations you will need to tolerate.
You can also choose funds based on their theme or where they invest: for example, there are funds focusing on sustainability and funds that invest in the emerging markets.
If you need help in choosing funds to invest in, book a meeting with us for investment advice. The meeting won’t cost or commit you to anything.
.svg)
