A quality fund offers an active portfolio of reputable funds and optimizes costs for the benefit of the investor. If he also invests in his own fund, he returns management fees. For foreign funds, it is possible for its clients to receive management fees back to the fund. In efficient markets, meaningful use of the machine’s indices and in low-income markets, it buys paper directly, especially local bonds.
The fee structure must be designed so that when selecting foreign funds can only respect the criteria of quality and added value. However, even the best fund does not protect the investor from market fluctuations and the associated emotional purchases and sales, which investors themselves in an otherwise favorable period reduce the overall performance below the performance of term deposits. Daov suit is not a difference of quality, is the property of the fund fund as such. In the same way, currency risks should be a matter of course for koruna investors.
There are boards, quality hundreds and tens of thousands of quality managers. Even the top manager has above-average and below-average products, in addition to launching new products and suffering from time to time with the departure of top portfolio managers. The goal of every investor is to have the best portfolio. The goal of any quality advisor is to compile such a portfolio for clients. This is possible when several conditions are met:
1. The portfolio suits the client’s (risk) profile.
2. His manaer, lpe manaei, are selected according to quality criteria and added value.
3. The whole must not be too expensive, so that the added value reaches the investor as well.
4. It should respect the specifics of the local market.
5. An actively managed portfolio must not suffer from complex administration, inflexibility to respond to significant events and, last but not least, must take into account the tax position.
Concerns of the investor
It is argued that for investments and units, even a million crowns is the optimal price of the last two conditions of the fund. The skeptic will quite rightly oppose the exchange costs associated with the fund fund, which must pay two equal amounts. In some cases, I may question the independence of the collection fund according to the quality criteria. The most important thing in the end – to compile and manage a portfolio that meets the risk profile of the client is dark, because most investors dynamically change their profile. They are “real and long-term” when stock markets are rising, and they become “conservative with a few months’ horizon” when stock markets start to fall. This is to some extent related to the misconception that the professional pension administrator must see into the future and you adequately, and especially react radically. When this is not the case, they prefer to take the activity into their own hands. And with exceptions, it will be a disaster.
Is there one of these concerns?
Conformity fund fund is especially an investor one product with a relatively low investment easily obtains a portfolio of funds of funds of many different institutions, which would otherwise have nothing to share, then follow it. Any changes in the portfolio are sensitive for the fund. For example, shifts in units of even tenths of a percent are very difficult to implement. In addition, activities within the fund do not generate a tax liability. But what about the disadvantages?
Kritrium kvality a nezvislosti
Why should a fund manager prefer competing funds if they are better? It’s simple. He did so only if it would not lose operations for him, if he could generate the maximum performance of the fund for a fee and if he did not have a conflict. It was just that I didn’t care and were objective. Independence is not derived from the fact that “Mr. Independent” sm dn products nem, but is derived from the source and form of his income. Even the so-called independent advisor may have a known conflict if he has products from only a few managers and the structure of his income motivates him to prefer either selected types of products (for example, investment insurance) or selected managers for whom he has agreed commissions. It is not only the one who is paid by the client who is dependent. It doesn’t matter if it is an advisor or a fund manager. For example, if the advisor has only a limited number of products, the independent fund transfers the objectivity of the selection of the best managers to it.
The analyst of a large company will then use all the resources and easier access to funds and companies, which is able to choose according to criteria that make two sense. It not only analyzes publicly available data on performance and risk, but also assesses those aspects that companies are reluctant to publish (for example, the departure of the manager’s portfolio to the competition). The renowned fund manager Sauren fond came out very clearly in his motto: We do not buy funds, but portfolio managers. Independence is now common among large foreign investment companies, but it is not a matter of course.
The most important is the cost structure. It includes practically the entire added value resulting from diversification between several managers and the independent selection of quality funds. At first the fund the fund is not cheap. This disadvantage can be overcome by using creditworthy bond bonds, returning or the entire management fee from fund to fund and a suitable combination of active and cheap liabilities.
Last but not least, index funds can be used to a limited extent, especially in developed markets. Here, however, a cautious approach is necessary. The index fund is cheap, but breaks down only one layer of the fee. To compile a fund of funds only from index instruments is basically the same as to compile an active fund, which resigns from the selection of specific titles, but does not pay many investors, because it charges the management fee of the active fund. Its added value could then lie in the fact that it will very actively shift its position between the stock and bond markets, or regions and sectors. And that’s not the way to hurry.
It makes no sense to disregard that mutual funds are usually expensive than traditional funds, although there may be exceptions. However, they are often cheaper than the so-called active first of the fund’s portfolios, and those high-quality clients will change it disproportionately in added value. It is possible without an oversight or that an investor with hundreds of millions of crowns can have a dark portfolio compiled without restrictions. In the case of the same risk profile, its individual portfolio would be composed practically in the same way as a cost-enhanced fund of funds. The only difference would be in the prices for this promise. He would get it cheaper, but he wouldn’t get anything extra under the same benchmark.
Risk profile of the client
And that’s what the risk profile is, the longest investment step. There is a lot of evidence that investors make a lot of money, they couldn’t. They are threatening – due to their activity, for example in equity funds, almost half of them are valued in comparison with term deposits for the period when equity funds increased by 9.6% pa (you will find more HERE). Even the best fund fund will not offer what most investors oekv. High profits during the growth of the stock market and ensured at a time of their decline. For the fact that even among the funds of the fund you will find the strategy “conservative”, “balanced”, “dynamic”, “aggressive” and so on, must suggest. If the fond fond had to fulfill the indicated role, it would probably stand only one and it would be called “Fond fond do kadho poas”. Such products can be found among the so-called hedge funds.
However, I know that within the fund the fund is an ongoing activity and that its gossip client obtains a diversified portfolio of funds from various institutions, it should help the investor not to start pointlessly buying and selling funds during the withdrawal period. It will always end a step behind – buying the best and after their growth and selling the mountains and after their decline. First, this property of an investor to buy expensive and sell cheap leads to the fact that it would be better for them not to invest at all. It really doesn’t make sense to take the risks of the stock market and half the return on a term deposit at a time when the stock market provides a risk premium. But that’s her thing.
In this text we must go to change another aspect. When creating a portfolio, it is not only a selection of funds, but also a harmonization of assets (stocks, bonds, money market, commodities, real estate) and according to regional and sectoral allocation, the harmonization of different styles of different managers and the like. The goal is to compile and create such a portfolio, where there is no remaining overlap leading only to the “full” portfolio of the fund, which most investors actually own.
The reference currency is also related to the risk profile. The most important specificity of the Czech market is the strengthening of the koruna against world currencies, which is interesting, but there was also a risk of the stock market. To hedge the fund’s new risk, the fund should be a matter of course, because only in this way can it be possible to gain meaningful opportunities to enter world markets without being limited to regions and sectors, and cover them with the best quality managers regardless of their presence in the local market. The strengthening of the Czech koruna thus does not reduce the performance of foreign investments for the Czech investor. The key is for there to be a relatively clear and stable trend of the Czech koruna, strengthening the years of differences. Otherwise, hedging currency risk would not be so significant, especially for risk strategies.
I have a good quality fund. However, he must meet the conditions so that his expenses do not eliminate the added value resulting from the collection of spades of funds and active portfolio. Nabz se se several een. The selected fund must be independent, subject to quality criteria and should not be limited to the main range of managers. A profitable investment should be made directly, the management fees of the own funds and the hundred management fees that it obtains from third parties should be returned to the fund by the fund.
Fincentrum supplement: how is it with fond fond u ns
The funds available in Czech korunch have recently become a very popular tool for both investors and investment companies, and all major managers offer several products to choose from. Most of them are fund profiles, which offer investors several different measures to base their risk profile.
Table of basic properties of products offered by domestic investment companies
Among the latest, Pioneer Investments has been launching its products, which recently launched three funds under the joint name Pioneer Multibrand. There are three so-called strategies: Conservative strategy Global Defensive CZK, Development strategy Global Dynamic CZK and Progressive strategy Global Progressive CZK. The portfolio of individual products consists of mutual funds of world companies such as JP Morgan Fleming, Fidelity Investments, Morgan Stanley, Fortis, Pictet Funds, DWS Investments, Franklin Templeton and, of course, Pioneer Investments.
Clients thus have some funds in Multibrand to choose from, which are not commonly available to us. As with its other products, Pioneer hedges the lower risk it will attract to koruna investors, as does the repayment of management fees by Pioneer Investments and some third-party funds. The disadvantage of the offered product may be the number of funds or you have a minimum investment compared to other companies.
Investin spoles esk spoitelny offers the largest selection of crown funds. The basis of its offer is made up of five profile funds: Opatrn Mix, Konzervativn Mix, Vyven Mix, Dynamick Mix and Akciov Mix. These funds invest primarily in mutual funds of ISS, Erste and Index Funds (ETFs), but also in funds of various investment companies around the world. The advantage of ISS funds is low entry fees and for some so low investment, wall funds provide less risk. In addition to profile funds, ISS offers funds like funds, ISS Global Stocks FF shares and ISS High Yield FF bonds (high-yield bonds).
P Invest offers three basic investment programs: Conservative, Export, Dynamic and Stock. Their inconvenience is that the portfolios are made up exclusively of P Invest funds, the advantage may be a relatively low minimum entry fee and of course the hedging currency risk of the funds in the portfolio. For those who want to create their own portfolio from the P Invest fund, an Individual Investment Program is prepared. Although there are “only” P Invest funds to choose from, the investor has a free choice of choice and ratio of individual funds in the portfolio.
SOB offers three fund profiles: Conservative, Vyven, Rstov and Dynamick. Their advantage, as in the first case, is the hedging of currency risk in foreign investments and the return of the management fee from the funds represented in the portfolio. The disadvantage is that only the products of KBC’s parent company are represented in the fund’s portfolios.
The company IKS komern Banky also offers three products with the joint name Fnix. Conservatively, Smen and Dynamick invest the funds only in the IKS KB fund, or the parent company of Socit Gnrale AM. The Fnix Dynamick Plus fund also expands its portfolio to funds of other management companies, similar to the ISS or Pioneer Multibrand funds.
The product similar to the fund is offered by Conseq IM. It is an Active Invest product that offers the following portfolios: Conservative, Vyven and Dynamic. The portfolios include Conseq, Franklin Templeton and Parvest. The individual portfolios are available in three currencies (CZK, EUR, USD), the composition of the same exchange does not match in the individual currencies, so they are different products. The shift to another target group than other products proves the minimum investment of 100,000 K. This certainly discourages many potential investors, as well as some entry fees.