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Shares vs Managed Funds

Do you want to spread your investment across a broad range of different asset classes (funds) or just invest in particular companies (shares)?

And do you have the knowledge and time to manage your portfolio yourself, or would you prefer to trust experts who ‘live and breathe’ financial markets to make day-to-day decisions on your behalf?

In a managed fund, your money is pooled with other investors’ money and spread across different kinds of investments. All investment decisions about what to invest in, including when to buy and sell, are made by the fund manager. Each investor owns a portion of the total fund.

When buying shares, however, you’ll be responsible for deciding what companies to invest in.

Then if you choose shares, there’s the decision of whether to use a broker or an online share platform, both of which are likely to charge fees per transaction. You may also end up with new tax obligations that you’ll need to factor into your overall financial situation.

If you like researching investments or have specific things you wish to invest in and can tolerate the potential ups and downs, then shares could be the right option for you.

For everyone else, go Managed Funds every time!