Managed Funds
Managed Funds are a very popular form of investing and include unit trusts, superannuation funds, group investment funds and insurance bonds. Managed funds allow investors to buy a much wider range of investments than they might otherwise be able to purchase individually. There are also various taxation issues that need to be considered with the recent introduction of PIEs (Portfolio Investment Entities).
You can invest either a lump sum and/or make regular contributions from as little as $100 per month. The tax treatment of the various managed funds often dictates whether it is best to use unit trusts, group investment funds or the tax paid superannuation trusts and life bonds. Broadbase will help you to make the right decisions for your individual situation.
There are four main types of investments in managed funds. Some funds have all of these (multi-sector funds) and others specialise in just one category. There may be New Zealand and/or offshore investments. The four main categories are:
Cash
Large pools of at call funds which offer a high rate of return from the first dollar invested.
Fixed Interest funds
Assets such as Government stock, capital notes, mortgages and term deposits make up these funds.
Property
There are many options available from rural property trusts where differing farm types and forests are the investments in the fund to investments which have pools of commercial properties of various kinds and differing locations.
Shares/Equities
The shares of companies both in New Zealand and offshore. If you were contemplating buying shares directly you would need to own the shares of many companies to reduce investment risk. Managed funds that invest in shares provide the essential volume and mix as well as the required disciplines of professional management. Share trusts/bonds are an excellent way to own a diversified portfolio of both New Zealand and/or offshore shares. Offshore shares should be part of all portfolios since the New Zealand market is small, can lack liquidity and is not as well diversified as the markets of larger countries.
Managed funds can be used for:
- Retirement planning
- Education funding
- Any savings goal
Make sure that you get professional advice. Your time frame for the use of the money, your attitude towards investment risk, your tax position and your need for income/growth are all crucial factors in the selection of investments.
Based on your answers, our knowledge of the economic environment and the information we have about all the investment options Broadbase will design a uniquely individual investment portfolio to suit your requirements.
We will also handle the administration and management of your funds with regular reports and consultation to ensure that your money is really working for you.