The Benefits of Managed Investing

A managed investment is a set of financial assets owned by a person and managed by a money/investment manager. This individual takes into account an investor’s financial goals and risk tolerance when building a portfolio of investments. They are also accountable for ensuring the account stays in line with a client’s financial objectives.

Managed investing is most commonly used by high-net-worth individuals, as it usually requires a minimum dollar amount of investment and often comes with fees. These fees are typically based on a percentage of the total value of an investor’s assets under management. This is in contrast to mutual funds that have no minimum investment and are open to the general public.

The advantage of a managed investment over a mutual fund is that the money/investment manager has control over how assets are bought and sold and when. This means that the professional guiding an individual’s managed account may attempt to offset gains and losses by buying and selling assets at the most advantageous time from a tax perspective, which can have a significant impact on the investor’s bottom line.

Another benefit of a managed investment is that it offers a level of diversification that may not be possible for an individual to achieve on their own. This is because funds can be purchased that are specifically designed to invest in various asset classes such as cash, property and shares. Some of these are also known as multi asset or diversified funds.

The benefit of this type of diversification is that it helps to reduce the overall volatility of an investment portfolio. However, this does not eliminate any market risk and investors should be prepared for fluctuations in the value of their portfolio.

In addition to the benefits of diversification, a managed investment can provide a level of sophistication and expertise that is not available to individual investors. This can include the ability to offer advice on areas such as retirement income planning, estate planning and tax strategies.

As a result, it’s important that anyone considering managed investments does their research and finds a firm with the right credentials to suit their needs. This includes finding out how long the firm has been in business and whether they have a track record of managing client accounts. It is also worth comparing fees as they can vary significantly between firms.

When it comes to wealth-building, the sooner you start to save and invest the better. If you’re at the early stages of your journey, a self-directed approach to investing may be best for you as it will likely come with lower fees than a managed investment. This will mean that any money you would have spent on management fees can go towards growing your savings. Managed investing

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