Investing in funds for beginners

Investing in funds for beginners

Are you considering investing in funds*? There are a number of reasons why that's a good idea. It's a convenient form of diversified investment that offers advantages to beginners and experienced investors alike.

*A fund or investment fund is the popular name for a collective investment institution.

The benefits of funds for new investors

1. Broad diversification

One of the most important pieces of advice on the stock market is: "Don't put all your eggs in one basket". And that's exactly what a fund achieves on your behalf. One of the main advantages of investing in a fund is the broad diversification across different investment types. This might include shares, bonds or even other investment instruments.

Adequate diversification is important in order to limit your investment risk. The level of diversification you can achieve as an individual investor by investing in a fund can normally only be attained by professional investors. An investment fund bundles together a very broad range of individual financial products, such as shares and/or bonds. 

2. You don't need to follow the financial markets closely yourself

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Your investment fund is managed by financial experts who adjust the mix of shares and bonds in your fund. They do so in response to the current situation on the financial markets, meaning that you don't need to keep a close eye on things yourself.

3. Combine shares and bonds in mixed funds

Different funds have different areas of focus. That means you can choose whether to invest in a fund with an emphasis on bonds, or one concentrating on shares. Mixed investment funds combine shares and bonds, which in turn provides greater diversification.

4. Extensive choice

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There is an appropriate fund for every type of investor.

Are you a cautious investor or are you happy to run additional risk for a higher return? This is what determines your risk profile. You are free to choose a fund that corresponds to the level of risk you wish to take, whether you have a defensive or a highly dynamic approach. You can also pick a fund with capital protection or floor monitoring.

5. For large and small amounts of capital alike

You don't need a large amount of capital to invest in funds. With an investment plan, you can start investing for as little as 25 euros a month. Do you want to invest a larger amount? Investment funds are attractive here too, thanks to their broad diversification across a number of different financial products. 

What is involved in investing in funds?

Would you like to start investing in funds, but still have some practical questions? You can find plenty of information on our website to help you on your way. You can find out more about what happens with the returns from funds and about the costs of investment funds. Do you care about the environment and sustainable development? If so, you should definitely consider a socially responsible investment.

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