What is Unit Trusts?
A unit trust is an investment vehicle that comprises a pool of funds from many investors and managed by a fund manager. The fund manager will invest the pooled money into assets such as stocks, bonds, money market instruments, a combination of these investments, or even other funds. By purchasing unit trusts, it will give you exposure to all the investments in that fund. The collective holdings of the assets held in trust will form the total portfolio of a unit trust fund.
Recommended Funds (Dec 2023)
CPF Funds – Tactical
CPF Funds – Core
Why Invest in Unit Trusts?
Unit Trusts are managed by professional fund managers with expertise and experience in investments. Your investments will be monitored regularly by the fund managers who will make investment decisions based on research and analytical tools that you may not have access to.
Unit Trusts typically invest into a number of stocks and/or bonds in its portfolio that are from different companies and often from different industries or regions. This means that the poor performance of any one security or business sector is not likely to have a major adverse impact on your investment as a whole.
Windows of investment opportunities
Investing in Unit Trusts not only allows one to gain access to overseas markets at ease, it also allows individuals to invest in products that might not be affordable. For instance, some bonds require a minimum investment of $100,000. Thus, Unit Trusts are good alternatives for investors to participate in these bond exposures at a relatively lower entry amount.
When building a diversified portfolio, the costs associated with buying units in a mutual fund may be lower than buying different individual stocks and bonds. This is due to economies of scale where the costs of accessing extensive research as well as, administrative, operating and trading expenses are spread amongst a large number of Unit Trust investors.
Unit Trusts are mostly open-ended investments that investor can buy and sell on a daily basis (unless otherwise stated). Fund management companies are mandated (under normal circumstances) to meet all “sell” requests from the unit holders
How to Invest in Unit Trusts?
Regular Saving Plan (RSP)
Whether you are planning for retirement, saving for your children, or achieving any financial goals, you need a sound investment plan and the right product to see you through. Regular Savings Plan is an investment plan that can help you meet your financial goals. It takes advantage of the dollar cost averaging concept that does not require you to worry about market timing and volatility.
Other than investing regularly via RSP, you can invest in lump sums starting from S$500 (minimum investment amount varies between the funds). With lump sum investing, you can invest the money all at once into the market as soon as possible.
There are many good reasons why you should transfer in your assets from elsewhere to POEMS. You can consolidate your holdings in a single view and save more on your investments. Transferring in your assets is completely FREE-of-charge. What’s more, be ready to get rewarded when you invest and accumulate your assets with your POEMS account.
Why wait? Transfer in your Unit Trust holdings and enjoy the following benefits:
– Be rewarded up to S$1,000
– 0% Platform Fees, 0% Sales Charge, 0% Switching Fee when you trade via POEMS
– Widest select of almost 2,000 funds
– 24/7 access to your investments via POEMS