Indonesian Mutual Funds Suitable for Beginners: Tips & Important Terms

Reksadana yang Cocok untuk Pemula: Tips & Istilah Penting.

Artikel diperbarui pada 17 May 2023.

Still confused about finding a mutual fund that is suitable for beginners? Investing is indeed an increasingly popular choice because of the benefits that can be obtained only with capital funds. In addition, there are many types of investments that can be relied upon in the long run.

Reference for Mutual Funds Suitable for Beginners

mutual funds for beginners

Choosing the right mutual fund is one of the precursors to a good financial future.

Especially when coupled with purposeful sustainability and good investment development. But how to get started? Here’s a selection of mutual funds for beginners.

1. Money Market Mutual Fund

Money market mutual funds can be an easy and relatively simple option for beginners to implement. This fund is a type of investment that is placed between 80% – 100% in the money market.

The investment is in the form of stocks or bonds that have a maturity period of less than one year.

The risk of mutual funds is claimed to be the lowest of other products, so it is suitable for beginners who are still learning to manage finances by investing.

In addition, the management by the Investment Manager will make the risk easier to avoid.

2. Fixed Income Mutual Fund

Moving on to the second option which is equally low risk but has the opportunity to earn.

This fund is a fixed income fund, which means that investors will get income in a regular tenor, so it can be relied on as a result in a certain period of time.

The disbursement system of this profit fund is obtained through an 80% investment in bonds or securities that provide regular returns.

In this case, investors have a choice of withdrawal times, namely per one month or per three months.

3. Protected Mutual Fund

This type of mutual fund is classified as a structured mutual fund that has a more directed management system and provisions.

In its specifications, protected mutual funds provide benefits for investors with a guarantee of fund security.

The protection provided will at least maintain investor funds according to the initial investment nominal, thus minimizing capital losses.

This allocation is earmarked for bonds and debt instruments, but investors cannot redeem before maturity.

4. Guarantee Mutual Fund

In terms of terminology, guarantee funds are similar to protected funds. However, in practice, this guarantee is not carried out by the Investment Manager as the manager of investor investment funds.

The guarantee is instead directed to the insurance company that accompanies the mutual fund of the investor’s choice.

The guarantee system also ensures that clients at least get their capital back. Unfortunately, this mutual fund has not yet been implemented in Indonesia.

5. Sharia Mutual Funds

To fulfill the investment needs of some people who apply sharia principles, sharia mutual funds can be a relevant reference.

In general, the form of Islamic mutual funds is similar to conventional mutual funds. It is only differentiated by the system and operations.

This type of mutual fund provides comfort and peace of mind for investors to choose fund assets that are sharia-compliant.

In addition, this mutual fund also avoids issuers with industries that deviate from the principles such as the pork and cigarette food industries.

Tips on Mutual Fund Investing for Beginners

In every business, financial management or a kind of investment product certainly has risks and opportunities on a certain scale.

As mutual funds are realized to help develop finances better. As for investing in mutual funds for beginners is as follows.

1. Seeking Information, Recommendations and Practices

After hearing the grapevine about mutual funds, many questions may arise.

This can be further explored to learn more about the system, how it works, and the types of mutual funds that are best to try.

One’s understanding will also be broader if one is willing to listen and seek more experiences of investors who have traveled the world of mutual funds.

Gather all the information for consideration.

2. Start Planning Your Finances More Carefully

If interest begins to grow, then immediately make preparations in the form of more mature planning.

In this case, prospective investors need to direct their funds to primary posts and divide them for new posts, namely investment.

By setting aside new fund allocations, it is also necessary to manage short-term finances and ensure that there are no spending leaks that can choke your finances.

This way, investors don’t just rely on one initial capital but can continue to grow it.

3. Choosing Mutual Funds Based on Recent Track Record

Finding the best mutual funds is not difficult. It can be found through searches that are open to the public and can be accessed by anyone.

A mutual fund is said to be potential if it is able to maintain profits for at least the last three years.

The selection of mutual funds can also be influenced by the financial condition of the investor, so that it can be adjusted to the minimum capital required.

However, still prioritize trusted mutual funds that are legal and have legal entities.

4. Prepare All the Tools and Elements Needed

To smoothen the mutual fund investment goals, then the element that is no less important is about the preparation in physical form that must be pocketed by investors.

These include platform selection, documents to register with mutual funds, mutual fund accounts and capital funds.

All the necessary things should be done through proper registration procedures.

Detailed steps are generally available on each mutual fund platform that can be accessed online, making it very flexible anywhere and anytime.

Know the Terms Related to Mutual Funds

Knowledge is said to be limitless for people who are not satisfied with the knowledge they have.

This includes adding to the vocabulary of mutual funds and understanding their proper use. Here are the terms used in the realm of mutual funds.

  • MI: Investment Manager that handles securities transactions
  • NAB : The Net Asset Value managed in a mutual fund and includes cash, deposits and bonds
  • UP : Participation Unit which shows the condition of investor’s participation or NAV broken down into investment instruments
  • NAB/UP : Net Asset Value per unit of participation in the sense that the price and transactions carried out based on the value of a mutual fund
  • NAB/UP.
  • Redemption : The cost to sell a mutual fund and usually ranges from 0% – 5% of the investment value
  • Subscription : The cost to buy a mutual fund and usually ranges from 0% – 5%
  • Prospectus : Company profile and annual financial statements on equities as an investment reference.
  • Custodian Bank : A financial institution that acts as an administrator, supervisor and custodian of investment assets.
  • Disbursement Transaction: Transaction of distributing units owned by investors
  • Switching Transaction: Switching of a particular mutual fund to another type of mutual fund by an investor
  • Switching Transaction.
  • Securities Portfolio : Securities that have investment value, usually in the form of stocks, bonds and mutual fund investments that have been sold.
  • KIK : Collective Investment Contract which is a mutual fund contract between the Investment Manager and the Custodian Bank
  • KIK.

This is the information about mutual funds suitable for beginners and related information that can be a reference material for investing with mutual funds. Although it will be a new thing to do, with the right preparation the investment will be profitable. Hope you find it useful.

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