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How to Pick the Best Mutual Fund

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Mutual fund investing is getting popular in the Philippines recently because  many Filipinos now are learning financial education. We can see it in many trainings and seminars that are being conducted around the country involving financial education, business ideas, self-motivation and many more.

I have been investing in mutual funds only this year and I begun to learn many sides of investing in mutual funds. Actually, some of the financial gurus and advisers recommend to invest some part of your money in mutual funds because it is professionally managed by experienced investors in stocks, bonds and commodities.

Compared to investing in stocks directly by yourself, investing in mutual funds has less risk of losing money because the money you put in mutual funds are managed by professional investors. If you invest directly in stocks, you may have limited knowledge about the stocks you will buy and you don’t know what price you should buy it or sell.

One common problem of newbie investor is choosing the best mutual fund in the market. It is also my problem when I started to buy mutual fund last January of this year. I don’t have relatives or friends that I can ask on how to pick the best mutual fund since no one of them have the experience in investing in mutual funds.

However, before I bought my mutual funds, I make it sure that I thoroughly understand what I am dealing with since it is my money involved. I learned different types of mutual funds that you can buy in the Philippines. In my research and study, I learned how the procedures and benefits of investing in mutual funds.

How to Choose the Best Mutual Fund

Some of the pointers you need to know in choosing the best mutual fund are the following. This list is some of the criteria I’m looking for the best mutual fund.

1. History of Good Performance

You can learn the performance of mutual funds in the Philippines by visiting ICAP website. It is the association of all mutual fund companies in the Philippines.

2. Managed by Experienced Fund Managers

In the mutual fund prospectus which you can download from their website, you will know who are the fund managers and their competencies in managing the money of your fund.

3. No or Low  Sales Load and Redemption Fee

Every time you buy or invest in mutual funds, you will be charge a sales load normally 0.5 to 2% of the money you will invest. However, some mutual fund companies waived this fee so it will be free to buy mutual funds. Most of the companies do not charge redemption fee after six months period.

4. Ease of Adding Funds

For me this is very important since I am working abroad. Every time I want to buy or add my mutual fund investment, I just can do it online using my Metrobank Direct Access. In the bills payment, I can buy more shares by selecting my mutual fund just like paying utility bills.

5. Good Support and Customer Service

A customer-oriented company is quick in responding to its clients request and queries, they are accommodating and helpful to their needs.

Choosing the best mutual funds suited for you is not easy thing to do. You need a sufficient information to decide where to invest your money. In order to pick the best mutual funds available in your location, you can consider my suggestions above. It can help you decide which funds to choose from.


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