A mutual fund is a pool of money collected from companies and private investors like you. It’s our goal to put the collected money in the right places so it can grow over time.
Let’s say you and your friends want a cake, but not everyone can buy on their own. What’s the best thing to do? Chip in! A trusted member from the group collects the money and buys the ingredients . And once the cake is baked, everyone gets a slice based on the amount they contributed.
That’s how simple mutual funds work! But unlike the cake you’ll eventually consume, the share you’ll get from the mutual funds is something that you can use for your future.
The key feature of a mutual fund being bought and sold based on the daily NAVPs is lost. Maybe you can come up with an analogy of how the price of ingredients change.
Mutual funds are a mix of bonds, stocks, and other financial instruments. When you buy or sell a mutual fund, you’re also buying and selling a combination of bonds, stocks, and other financial assets. Returns will depend on the condition of the markets represented by the mutual fund.
The safety of your investment is our top priority. That is why PAMI implements its own investment guidelines and restrictions. For example, we partner with a custodian bank to take care of the financial assets. A transfer agent, on the other hand, keeps a timely record of your investment. To maintain transparency, an external auditor likewise keeps track of the operations while the Securities and Exchange Commission (SEC) closely monitors all funds.
As an investor, you should note that returns from mutual funds may vary. All returns depend on the following factors: the amount of money you invested, market conditions, and the strategy of the fund manager.
Yes, you can! Mutual funds have no maturity period. This means that you can keep your investments as long as you want, which is recommended especially if you have long-term financial goals. If you decide, however, to withdraw your funds before the recommended holding period, you will need to pay a corresponding early redemption fee.