Invesmtent & Private Equity
“Many people want to invest instead of just save, but don't know where to start or feel overwhelmed by the variety of options. Even with small amounts, targeted investments can help you achieve your personal goals and wishes more quickly and easily. We give you a clear overview of the various investment options and develop a customized investment strategy that is perfectly tailored to your needs.”
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One of our experts is ready to help you create a personalized investment plan that aligns with your financial goals.
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Key facts
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Investment funds spread the capital across various investments (e.g. shares, bonds) and thus reduce the risk.
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Funds are managed by experienced managers who actively adjust the portfolio to market conditions.
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Funds allow investments in difficult-to-access markets or specialized sectors, even with smaller amounts.
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Fees are charged for managing a fund, such as management fees and front-end loads.
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Units in investment funds can often be bought or sold daily or weekly, which offers a high degree of flexibility.
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There are different types of funds (e.g. growth, bond or balanced funds) that are tailored to different objectives and risk profiles.
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Funds offer opportunities for returns, but also involve risks due to market fluctuations.
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Funds are subject to strict regulations and must regularly disclose their performance and fees.
Advantages of Investment Funds
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Risk is minimized by spreading the capital across different asset classes and values. Investors benefit from a broader spread of risk, which reduces the risk of loss.
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Funds are managed by experienced fund managers who actively monitor and adjust the portfolio. This gives investors access to specialist knowledge and a professional investment strategy.
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Investment funds make it possible to invest in markets or sectors that would otherwise be difficult to access or very capital-intensive, such as international markets or specialized industries.
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Many funds allow entry with relatively small amounts, which also gives small investors access to diversified portfolios.
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Most investment funds offer high liquidity as units can be bought or sold frequently, often on a daily or weekly basis.
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Funds are subject to regulatory requirements and must publish regular reports that provide investors with transparent insight into performance, fees and investment decisions.
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Depending on the country, certain investment funds may offer tax advantages, e.g. tax relief for long-term investments or the possibility of tax deferral.
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These advantages make investment funds an attractive option for investors who want to benefit from broad diversification and professional management without having to actively intervene in the markets themselves.
Disadvantages of Investment Funds
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Funds charge management fees, which can reduce the return. These fees can vary depending on the fund and provider and add up in the long term.
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Although funds are diversified, there is no guarantee of profits. Returns depend on market performance and the investment decisions made.
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Fund managers make the decisions on the composition of the portfolio, which gives investors little influence on the exact selection of investments.
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Depending on the fund structure and type, capital gains may be subject to tax, which reduces the return. Distributions may also be subject to tax.
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The liquidity of some funds (e.g. closed-end funds or real estate funds) may be restricted, which means that units cannot be sold at any time or only with a delay.
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Even with diversification, the fund is exposed to general market risks. A broad decline in the markets or individual sectors can have a negative impact on the value of the fund.
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The large number of fund types (e.g. equity funds, bond funds, mixed funds) can be confusing for investors and make it difficult to choose the right fund.
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​These drawbacks should be considered by investors to ensure that investment funds fit their individual objectives and risk profiles.
Different types of funds - an overview
There are two main groups of investment funds: actively and passively managed funds.
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Actively managed funds:
Here, a fund management team takes the decisions on securities, their weighting and the right timing. The aim is to beat a benchmark index and achieve higher returns through targeted selection and market assessments. An annual fee of 0.5% to 1.5% of the fund volume is charged for this.
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Passively managed funds (ETFs):
ETFs track a market index (e.g. the DAX) exactly and do not pursue active selection, but invest in the same stocks with the same weighting as the index. They are cheaper, but not free of charge - the management fee for the DAX ETF is around 0.15 %. Transaction costs may also be incurred when buying and selling.
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Important fund types:
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Equity funds: Invest in company shares and have a certain tangible asset character. They are susceptible to fluctuations, but the risk can be reduced through a long holding period and broad diversification.
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Bond funds: Invest in bonds and offer regular interest payments. The risk varies depending on the credit rating and maturity of the bonds.
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Mixed funds: Combine different asset classes such as shares and bonds, which enables a flexible response to market changes.
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Open-ended real estate funds: Invest in commercial or residential real estate and offer a rather stable return with moderate risks. The minimum holding period is usually 24 months.
How safe are they?
Pandemic, economic crisis, inflation and armed conflicts: We are moving through turbulent times, which also bring a lot of uncertainty to the financial market. In principle, however, investment funds have the aforementioned advantage over individual shares, bonds or commodity investments: they spread the risk by investing in different securities and markets. This means that market fluctuations in one sector can be offset by a suitable investment in a more stable market. The risk burden is spread across many shoulders and thus minimized. Investment funds can therefore be a stable and profitable way of building up your own assets and investing them profitably.
Of course, there is no guarantee against falls in value. And no one can predict with certainty how markets will develop. However, investors should not allow themselves to be unsettled too quickly by fluctuations, but should take a long-term view. After all, the return on the German share index (DAX) has always been positive over a holding period of twelve years in the last 50 years. And this despite economic crises and uncertainties.
Time is a security
As with most investments, time is your best friend when investing money in funds. This means that the longer the investment period, the more profitable and stable the performance. Together with your advisor, you determine an amount that you should pay in regularly and over the long term in order to take full advantage of the benefits of a fund. The earlier you start investing, the better your chances.
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Time as security
Only those who combine sufficient time with an appropriate return will be able to turn their investment into a fortune.
