Alert! These are 3 Characteristics of Canned Mutual Funds that Make a Loss

Jakarta, Armfalcon.com – Investment in mutual funds is good enough for short, medium and long term goals. However, don’t be tempted by the historical yields of a mutual fund product that can reach tens or hundreds of percent per year.

High returns do not guarantee that the performance of the mutual fund will remain the same in the future. It could be that future performance is even worse than the previous year.

So that you don’t regret it later, get to know the characteristics of mutual funds that you should avoid. Here’s the review.

Funds under management continued to decline

There is no need to panic when you see the fluctuating value of net assets per unit of participation (NAB/UP), because this is the effect of rising and falling asset values ​​in the mutual fund portfolio.

The thing that should be of concern to you is the size of the mutual fund that you want to buy.

Unfortunately, data on managed funds must be searched manually through the information available at fund fact sheet (FFS) or Mutual Fund Selling Agent (APERD) websites.

Managed funds or asset under management (AUM) is something you should pay attention to, Managed funds also often experience fluctuations and do not reflect the performance of assets in mutual funds.

However, this value shows how much investors trust the mutual fund in question.

Based on the Financial Services Authority (OJK) regulation No.23/POJK.04/2016 concerning Mutual Funds in the Form of Collective Investment Contracts, the minimum limit for managed funds for a mutual fund is set at IDR 10 billion.

When the managed fund continues to decline, especially drastically, you must also be suspicious of this.

There is no updated fund fact sheet

Simply put, FFS is a mutual fund product report issued by an investment manager regarding the performance of the mutual fund product in question. This information is updated regularly and can be easily accessed by investors.

If the latest FFS is not available, where can you find out about the progress of the mutual fund’s performance?

If you encounter something like this, it’s a good idea to contact the investment manager directly regarding the mutual fund products they publish.

It could be that FFS is not available because the mutual funds want to be disbanded because they no longer meet the requirements.

Mutual funds from rogue investment managers

There are not a few cases of mutual fund investment managers who often receive reprimands from the Financial Services Authority (OJK) because of the violations they have committed. And unfortunately, there is also no mutual fund investment manager rating based on investment performance, trustworthiness, and so on.

The question arises, if one of them offers investment products with fantastic returns, are you still interested in buying them?

As much as possible, avoid products like that and choose mutual funds issued by investment managers with a good reputation.

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(aak/aak)