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Most unit trust managers offer you a choice of
ways to invest as below:
As A Lump Sum
The minimum lump sum investment in a unit trust is typically in the range of
RM500 to RM2,000. There is no limit on how much you can save and invest in a
unit trust, though if you are making a very large investment, it is usually
advisable to spread your holdings among different funds so that you do not
have all your eggs in one basket.
If you are worried that the stock market could fall back from a peak just as
you invest your lump sum, you could consider investing it gradually through
a regular savings plan.
Via A Regular Savings Plan
Regular savings plan allows investors to put in a set amount monthly to the
unit trust of their choice. Usually the minimum initial amount is RM1000
though it may vary with fund managers. The minimum monthly additional
investments usually start from RM100. This is a convenient way of saving, as
monthly additional investments are usually paid through a bank's standing
instructions.
The regular savings plan is also flexible since they are not tied to a
particular period of time. This can enhance the returns from unit trust that
performs reasonably well over a long period. An advantage of the regular
savings plan is that they even out fluctuations in unit price. The same
investment each month will buy more units when the price is lower and fewer
when the prices are high.
The effect of ringgit cost averaging, as it is
called, is to make the overall cost of units slightly cheaper. Of course,
another advantage is that you can cash in the whole lot or part of it
without penalty on any business day. Regular savings plan can improve
returns significantly in the long run.
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