Investment idea:
Which funds are available?

Equity funds are investment funds that collect money from investors and then invest this money in shares of various companies. Investments can be made in different sectors, countries or industries, depending on the type of equity fund and the investment strategy. Here are some important aspects to consider with equity funds:

Areas or sectors: Equity funds can focus on different areas of the economy or sectors. For example, there are funds that focus on technology companies, healthcare, energy, financial services or other specific industries.

Countries or regions: An equity fund may focus on stocks from a specific country or region. There are funds that invest in US equities, while others specialize in European, Asian or emerging markets.

Diversification: One advantage of equity funds is that they can offer investors broad diversification. As they invest in shares of different companies, the risk is spread across a large number of securities.

Investment strategy: Depending on the fund manager’s investment strategy, equity funds can be operated in different ways. Some funds pursue a growth strategy and invest in companies with high growth potential, while others focus on value stocks that are considered undervalued.

Risk and return: The performance of equity funds can vary depending on their investments and strategies. There are funds with higher risk and higher expected returns and those that are more conservative and offer a more stable return.

Costs: Investors should consider the costs of an equity fund, including management fees and initial charges. These costs can affect the overall return.

Long-term investment: Equity funds are generally suitable for long-term investments, as they benefit from companies’ growth opportunities over the long term.

Fund manager: The fund manager is responsible for selecting the shares in the fund and implementing the investment strategy.

It is important that investors consider their investment objectives, risk appetite and time frame when selecting an equity fund. Selecting a fund that suits individual needs is a crucial step in portfolio construction.

ETFs are a type of investment fund that tracks the performance of a specific index such as the DAX or the S&P 500. Here are some of the key features of ETFs:

Index tracking: ETFs are designed to replicate the performance of a selected index as closely as possible. To do this, they generally hold all or a representative portion of the shares included in the index.

Stock exchange trading: ETFs are traded on stock exchanges, similar to shares. Investors can buy and sell ETF shares during the trading day, and their prices can change throughout the day, depending on supply and demand.

Liquidity: ETFs tend to be very liquid as they are traded on exchanges. This means that investors can easily buy or sell their shares, and there is no closing date as with traditional investment funds.

Full participation: ETFs offer investors the opportunity to participate in market fluctuations. They track the performance of the underlying index, both upwards and downwards.

Low costs: ETFs are often characterized by low costs, as they do not require active management by fund managers. The costs are usually lower than many other types of investment funds.

Diversification: ETFs offer broad diversification as they usually contain a large number of stocks or bonds that are represented in the index. This helps to spread risk.

Tax efficiency: ETFs are often more tax efficient than some other investment products as they have less capital gains realization due to low portfolio turnover.

Transparency: ETFs typically publish their portfolio composition daily, so investors know exactly what assets they are investing in.

ETFs are a popular form of investment as they offer investors a low-cost way to invest in the stock or bond market in a diversified way. They are suitable for investors looking for long-term investments, but also for those who want to trade in the short term. As ETFs are traded on exchanges, they offer flexibility and transparency. However, it is important to understand the specific features and costs of an ETF before investing.

Money market funds are a special type of investment fund that invests in short-term, highly liquid and relatively safe financial instruments. Here are some important features of money market funds:

Investing in money market instruments: money market funds invest investor capital in money market instruments. These include time deposits, short-term bank deposits, negotiable debt securities, commercial paper and other short-term fixed income securities.

Short maturities: The maturities of these securities are usually very short, often less than 12 months. This allows for high liquidity and rapid reallocation of investments.

Low risk: Money market funds are designed to protect investors’ capital and generally offer low risk. They are a popular choice for investors seeking stability and capital preservation.

Liquidity: Money market funds are very liquid. Investors can usually sell their units daily without a sales charge. This makes them an attractive option for short-term cash reserves.

Stability of the net asset value (NAV): Money market funds aim to maintain a constant net asset value (NAV) of USD 1 or a similar amount per unit. This means that investors generally do not experience large fluctuations in the value of their investments.

Income: Money market funds generate income from the interest earned on the money market instruments invested. This income is usually distributed to unit holders on a regular basis.

Costs: The costs of money market funds are generally low as they do not require extensive active management. Costs include management fees and other minor expenses.

Money market funds are often used by investors to meet short-term liquidity needs or to temporarily park excess cash. They offer a safe and conservative investment option that focuses on capital preservation and liquidity. It is important to note that although the risk is low, money market funds do not offer a guaranteed return and interest rates can vary, affecting returns.

Blended funds, also known as multi-asset funds or asset allocation funds, offer investors a flexible way to respond to market movements as they invest money in different asset classes. Here are some key features of balanced funds:

Diversification: balanced funds seek diversification by investing in different asset classes. These include equities, bonds, commodities, real estate and occasionally other assets. This helps to spread the risk.

Flexibility: Mixed fund managers have the flexibility to adjust the weighting of the various asset classes depending on the market situation and their expectations. This allows them to react to opportunities and risks.

Risk profile: The risk profile of mixed funds can vary depending on their composition. Some balanced funds are more defensive and put more emphasis on bonds, while others are more aggressive and invest more in equities and other riskier assets.

Return targets: Mixed funds can be geared towards different return targets, from conservative to growth-oriented. Investors can select balanced funds that match their return and risk preferences.

Management: Blended funds require active management by fund managers who make asset allocation decisions and investment choices across asset classes.

Costs: The costs of balanced funds can vary depending on the complexity of the investment strategy and the extent of active management.

Long-term investment: Blended funds are generally designed for long-term investment, although there are also blend funds that pursue short-term investment objectives.

Blended funds are a popular choice for investors who want to benefit from broad diversification without having to invest in different asset classes themselves. They also offer the opportunity to react to changes in the markets without investors having to constantly adjust their portfolio. However, it is important to understand the specific objectives and strategies of a balanced fund and ensure that they are in line with your investment goals and risk appetite.

Open-ended real estate funds are a form of collective investment that allows investors to put money into real estate without investing directly in physical property. Here are some key features of open-ended real estate funds:

Investment in real estate: open-ended real estate funds invest investors’ capital in real estate, including commercial properties such as office buildings, shopping centers, residential properties and other types of real estate.

Diversification: These funds often hold a wide range of properties in their portfolio, which allows for broad diversification. This helps to spread the risk.

Liquidity: Unlike direct real estate investments, open-ended real estate funds offer high liquidity. Investors can usually redeem and sell their units on a daily basis.

Small amounts: Investors can invest in open-ended real estate funds with comparatively small amounts, which makes it easier to access real estate investments.

Professional management: The funds are managed by professional fund managers who select, let and manage the properties in the portfolio. This saves investors the expense of property management.

Transparency: Open-ended real estate funds generally offer a high level of transparency, as they publish regular reports on the composition of their portfolio and performance.

Return: The return on open-ended real estate funds is made up of rental income, property appreciation and interest income from short-term investments.

It is important to note that while open-ended real estate funds provide an opportunity to invest in real estate, they are subject to market risks and liquidity risks that can affect performance and the ability of investors to sell units. While open-ended real estate funds generally offer broad diversification and liquidity, they can still be affected by market fluctuations and other factors.

Investors should consider investment objectives and risk appetite before investing in open-ended real estate funds and obtain information about the specific features and terms of each fund.