5 Basic Things you need to know before invest on fund

1. Consider how much risk can you take

- Simple rule, a fund that can make lots of money, also make a lot of risk.

Besides the profit, consider very clearly if you could take the risk. e.g. If you are going to retire within a few years, don't invest in some funds with high risk.


2. Read the fund report very carefully

- Don't just listen to someone says this is a trustful fund and invest it. Read the fund report, learn the fund performance carefully.


3. Check the other investor comments/news

- Similar to buy a mobile or camera, you go to the internet and check other users' comment, that may affect you choice.


4. Consult a fund manager if you have

- Consult someone who is the experts on this, their opinions are valuable.


5. Make sure you know what you are investing before confirm the deal

- Last but not least, make sure you understand what are you investing, that's is the most important thing among this list.


Reference:

http://www.jpmorganam.com.hk/

http://www.jpmorganam.com.hk/uffm-web/

6. never pay a front end load (or a trailing commission)


7. always choose a passive low cost index fund over an actively managed fund


8. never buy a fund that has a lock in period (unless the nature of the underlying investment requires it)


9. be aware of the difference between synthetic and non-synthetic funds


10. understand witholding tax and estate duty implications if you invest in funds which are onshore for US, UK etc tax purposes