Besides the potential for capital growth over the long-term period, unit trusts also provides other recognised benefits that makes them attractive relative to other investment avenues. Among them are as follows:
Diversification
Diversification involves the process of spreading risk over a broad portfolio of stocks and bonds in different companies, sectors, countries or regions. This can only be done with substantial amounts of moneys to buy a wide variety of stocks. Unit trusts facilitate the diversification process through providing small investors with an avenue to pool their savings for the purchase of a diversified portfolio of stocks and bonds that will bring returns at lower risks to unit holders compared with investing directly in stock markets.
Professional Management
Unit trusts either engage or maintain in-house professional fund managers with the expertise and resources to manage the assets of the fund. The investors thus benefit from this professional fund management of their investments in the fund at an affordable (shared) cost.
Liquidity
Unit holders may redeem all or part of their units on any business day and have their proceeds mailed to them within 10 days.
Ease of Transactions
Unit trusts do not require cumbersome administrative or paperwork or record keeping on the part of unit holder in managing his investments.
Affordable
As the minimum initial investment amount in most unit trusts is relatively low, they are affordable as compared to direct investment.
Capital Gains
Through participation in securities, unit trust investments provide the opportunity to reap capital growth as part of the return on a unit holder’s investment.
Flexibility
Investors may increase or reduce their investment at any time and switching among Affin's funds is made easy and free.
Unit Holder Protection
The unit trust industry is regulated by Securities Commission Malaysia to provide clear operational procedures and regulations.
Independent Trustee
Unit holders’ interests are protected by the provision of an independent trustee to hold the Fund’s assets. The Trustee will ensure the Fund Manager acts in accordance with the Trust Deed.
