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I have around 100,000 Swiss francs of savings and have been considering investing it in a fund so that money can start working for me. Should I follow through with this plan? Are there any drawbacks?
Hi there,
Because the future performance of investment funds is impossible to predict, the costs associated with the fund (the TER) are the key to determining whether it is the right way to invest a certain amount of money.
The higher the costs of an investment fund or asset management service, the higher the risk of expenses matching or exceeding returns. If, in the worst case, a fund does not yield returns for an extended period of time, the costs may end up eating into your investment capital.
As a general rule, passively managed investment funds like exchange traded funds (ETFs) have lower costs, and make more sense if you are looking to invest a relatively small amount of money.
Best regards from Moneyguru
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