A fund is a portfolio of investments containing various financial instruments, such as equities. When you invest in a fund, you buy shares in a selected investment portfolio. These shares are also called fund units. The value of a fund unit is calculated daily, and any increases or decreases in the value will depend on the returns produced by the fund’s underlying investments.
Funds are managed by professionals who monitor the markets on your behalf. This makes investing in funds fairly effortless and suitable also for budding investors.
Index funds have become popular because of their cost efficiency. Index funds are passively managed equity funds that track a certain benchmark index. The funds’ buy and sell transactions are triggered automatically based on developments in the benchmark index. Index funds track the selected index passively, and when markets rise or fall, the values of the funds track these movements.
Discover our selection of index funds and read more.
Fixed income funds may be suitable for you if you want to avoid large fluctuations in the value of your investments. Fixed income funds invest their assets in fixed income instruments. Their return is determined by the performance of the fixed income and credit risk markets. Regular coupons are paid on fixed income investments, which makes it easier to forecast their expected return.
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Balanced funds invest in both the fixed income and equity markets. A traditional balanced fund includes equity and fixed income investments, offering a good diversification over these two asset classes. The relative proportion of equities and fixed income investments in the fund allows the portfolio manager to adjust the fund’s risk and return potential. Our balanced funds are suitable for many different needs.
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You can choose the funds that suit your goals and risk tolerance from our diverse selection of funds. You can also focus on various themes or geographical regions and select funds that focus on sustainability or the emerging markets, for example.
It’s good to remember that saving in funds is really a form of investment, which offers a potentially attractive return but also comes with risk. Investment funds are best suited for continuous investment over several years.
This is because a fund’s value may increase or decrease as market conditions fluctuate, but over time the effects of these fluctuations will even out.
Funds are typically divided into equity, fixed income and balanced funds. In addition, funds can be described as active or passive. But do you know what these terms mean?
Fund costs vary based on the type of fund, as different funds have different costs. The amount of the management fee, for example, is influenced by such factors as the markets the fund invests in and the amount of work required to manage the fund.
Fixed income funds usually have lower costs and a lower return than equity funds.
You can check the costs from each fund’s key investor information document, which you can find in our Funds Now service.
The information provided on this website is intended as general product information only and does not constitute investment advice or recommendations. When it comes to funds or equities, past performance is not a guarantee of future results. The value of fund units or equities may increase or decrease due to market movements, and it is not certain that you will get back the entire amount you invested.
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