14.08.2013

Investment Option: Direct equities and Managed funds

Investing in direct equities and manage funds. This is a complex investment area with a vast array of investment options and styles. Before you make an investment it is important to consider what you are specifically looking for.

If you are investing in a direct equity you are basically buying the share directly yourself. As an example, if you buy BHP you are purchasing a portion of the company BHP.

You can do this in multiple different ways, you invest using a stock broker or you can do it through an online broking account such as CommSec.

If you invest in a managed fund, you control as to where you want to invest and how much money you invest. What you don’t have control over is what the underlying equity is. This is managed by the professional of whom you trust your money with. A managed fund has a benefit because you can put a small amount of money in and get a large exposure to various different types of equities without having to spend the time looking for what suits your situation and what is the best stock on the market.

There are many different types of managed funds you can invest in such as Australian shares, International shares, fixed interest as we spoke about in the previous video and even direct property. Just like when you analyse a direct share you need to analyse the managed fund to make sure that the fund you are investing in suits your specific situation.