Different styles of fund management
Different funds offer different levels of risk and potential rewards. Some fund managers adopt a cautious approach, trying to shelter investors from the worst of any stock market falls. Others are happy to take on riskier investment strategies in search of potential higher returns.
There are managers who look to add value by focusing on the bigger picture, identifying trends or reading the economic outlook before investing in areas they feel are most likely to benefit. Others place less importance on these wider influences and prefer to focus almost exclusively on the prospects for individual companies or investments.
With thousands of funds available, the choice can be daunting. That is why we created the Wealth 50, a list of our favourite funds across the major sectors. The Wealth 50 also contains the passive funds we feel offer the best value.
Hargreaves Lansdown has negotiated reduced annual charges on many of these funds for those who invest through us.
This list could be a useful starting place for those who wish to start investing in funds. We believe all managers currently featured on the Wealth 50 are capable of delivering exceptional returns for their investors over the long term.
Monthly investing or a lump sum?
One of the reasons for the popularity of funds is that they give investors access to a wide range of investments, and offer the benefit of an expert manager, without the need to invest large sums of money.
With Hargreaves Lansdown, you can invest as little as £100 into a fund as a lump sum, or set up a regular direct debit from just £25 per month.
Monthly investing has a number of benefits. Small regular investments can soon add up to a sizeable pot of money, and can help average out the highs and lows of the stock market. This takes the pressure off trying to time your investment correctly.
Please remember that investing involves risk and you could get back less than you invest.