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Unit trusts are great investments to create grow your wealth.
Whether you're saving for education, retirement, or any other financial goal, unit trusts give you excellent, transparent, low-cost ways to invest.

What is a Unit Trust?

Unit trusts pool money from many investors and invests that capital into the market according to the mandate of that fund.
Funds can invest into a diversified portfolio of assets such as shares, bonds, and property.

Each investor owns units in the trust and the value of these units depends upon on the performance of the underlying investments.
Expert fund managers carefully manage these investments to maximise their growth potential.
They watch the markets 24/7 and manage the investment on your behalf.

How it Works:

You invest R500 per month in a unit trust.
On the day of your first investment, you receive a certain number of units based on the unit price that day.
Say a unit is worth R 10 on that day - you will therefore get 50 units.

As the value of the underlying assets changes (up or down), so does the unit price.
Over time, your investment grows, providing a potential return on your initial investment.
So, if the price rises to R 12, your 50 units are then worth R600.

In your 2nd month, you invest another R500 at R 12 a unit, so you then get 41.6 units and have then have a total of 91.6 units.

The price then rises to 14 per unit and your total value is now R1,282.40.

Even if you do not invest any additional money from then on, those units still partake in the same process - you do not lose anything (but the growth potential those added funds could have given you, or if the underlying assets value drops)
This continues as long as you keep the unit trust alive.

It is recommended that you run a unit trust for at least 5-years to get the potential of a meaningful return.

Choosing the Right Unit Trust:

With various funds and investment strategies available, selecting the right unit trust can be complicated.
Each fund has a specific investing mandate (rules) and risk profile and aims to achieve certain objectives.

You need to consider your risk tolerance, investment objectives, and the fund's mandate when making your decision.
Diversification and long-term investment horisons can help reduce market volatility and optimise your returns.

Consider Your Risk and Reward

Every investment carries some level of risk, but with risk comes the potential for reward, so you need to assess your risk tolerance and choose funds that align with your financial goals.

Diversifying across different market segments and considering offshore investments can further reduce risk and enhance potential returns.

If you take little risk when investing your money - like saving in a bank account, the chances are your returns will not beat the inflation rate and you will never grow your wealth.

In fact, you take your bank interest return and subtract the rate of income tax and inflation and that is really your return!

Every saving and investment product offers different risks and potentials of return.
Things like how easily you can get your money when you need it, or how fast your money will grow and how safe your money will be.
Other risks to consider are, how the economy will perform, how the stock market will react to the economy over time and what inflation will be.

You also need to consider investment diversification, or not putting all your eggs in one basket. By choosing different segments of a market into which to invest, like minerals and resources, financial, cash, commodity shares and so on, you can reduce your overall risk.

You can also go offshore and invest in markets and companies outside of South Africa, again reducing your overall risk.

Market Volatility:

Market fluctuations are inevitable, but they don't have to derail your investment strategy.
The overall value of your unit trust is likely to go up and down as market prices change.
This is known as fluctuation or volatility.

Investing for the long term and selecting balanced or index funds can help mitigate volatility.
Remember, staying invested during market downturns often leads to recovery and long-term growth.

The amount of risk you are happy to take with your investment is key to choosing which unit trust you should choose.

Remember, the younger you are and the longer you can invest for, the higher the degree of risk you can take.

If your risk appetite changes over time - say because of market economies - you can simply switch funds and join a fund with a risk profile better suited to your then needs. It is easy to do!

But, it is better to make a considered decision in the beginning and to stick with it than to be surprised later and shaken into dis-investing at the wrong time!

Chasing market returns is not a recommended investing strategy as it never works!
No one can tell you how a market will perform tomorrow, let alone today!

The greatest risk you face is not investing at all!

Reducing Your Investment Risk

Investing in the financial markets can be daunting, especially considering the inherent risks involved.
However, there are strategies you can employ to mitigate these risks and potentially grow your wealth over the long term.

A Diversified Approach

Balanced Funds are designed to offer investors steady, long-term growth by balancing income generation, capital growth, and risk of loss.

These funds are managed by experienced professionals who have the flexibility to invest across various asset classes, such as equities, bonds, property, and cash.

By spreading your investment across different asset classes, you can reduce the risk associated with any single investment.

Investing Offshore

Another strategy to consider is investing in unit trusts that focus on offshore companies.

These funds allow you to diversify your portfolio beyond the South African market, potentially reducing your overall investment risk.
Since these companies operate in different economies and are subject to different market conditions, they can provide a hedge against volatility in the local market.

The South African market is only a small part of the global economy and if you do not look at offshore funds, you are really missing opportunities!

We have an excellent method to help you carefully and accurately choose a fund that is suited to your personal risk profile!

We will give you all the information on the risk and return profiles, the companies into which that fund invests and past performances of the fund you choose.

Interested?
Please complete the form below and email it to us.

FAQs: Addressing Your Concerns

1. What return can I expect?
The return of your fund depends on various factors, including market performance and the fund manager's investment decisions.
While there are no guarantees with investment returns, we can help you assess potential outcomes based on historical data and market trends.
There are no guarantees with fund returns and unit trusts can rise and fall over time.

2. How easily can I access my money?
With unit trusts, you can easily withdraw your funds at any time without incurring penalties.
Whether you choose to withdraw online or through other channels, the process is straightforward and typically takes only a few days.

3. Are there costs to consider?
Yes, there are costs associated with investing in unit trusts, including initial fees, annual management fees, platform fees, and expert advice fees.
However, all fees are fully disclosed, and we can help you understand their impact on your investment returns.

Why Choose Unit Trusts?

Unit trusts offer several benefits that make them an attractive investment option:

• Professional management by experienced fund managers.
• Diversification across asset classes for reduced risk.
• Flexibility to add, withdraw, or switch investments at any time.
• Protection under the law and fund mandate.
• Opportunities for long-term wealth building through compounding interest.
• No restrictive rules like endowments.
• You can cede your investment
• They are one of the most affordable ways of investing.

From as little as R 500 pm or a lump sum of R 5,000 you can participate in an extraordinary wealth-building investment!

General Information

Tax implications:Investment income is taxed according to your tax status, and capital gains tax may apply when selling units.

Estate planning: Your investment forms part of your estate and will be distributed according to your will.

Regular updates: Access statements online and track fund performance through various channels.

Investing in unit trusts has traditionally yielded good returns, offering you the opportunity to build real wealth.

Password:Yes, I want to INVEST R pm.

Please send me all the information I need to begin my UNIT TRUST.

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083 655 2164

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Important Disclaimer:This content is for informational purposes only and does not constitute financial advice. Past performance is not indicative of future results.
Please speak to me before making any decisions.

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Last update: September 8, 2025