WHAT IS AN INVESTMENT FUND?
An investment fund is an investment product with the pooled capital of various investors managed by a management company to maximise returns. The fund can invest in a wide variety of financial assets (bonds, stocks, dividends, etc.) and non-financial assets (real estate, commodities, etc.). Risk level is determined by the economic fluctuation of these assets in the market.
The main characteristics are:
- Liquidity: Investment funds generally allow you access to your money at any moment, although this operation may be subject to a redemption fee.
- Profitability - Risk: These variables are inter-related. In order to obtain higher returns, it is necessary to assume higher risks. Past performance is not indicative of future results.
- Costs: The fees, costs and expenses of subscription vary depending on the specific investment fund.
- Taxation: For individuals, capital gains and losses obtained by the transfer of shares in investment funds is included in the savings tax base of the IRPF, without taking into account its vesting period. Amounts up to €6,000 are taxed at 19.00%; between €6,000 and €50,000 at 21.00%, and above €50,000 at 23.00%. Such taxation depends on the personal circumstances of the taxable person and on the taxation in force at the time. For legal entities, income derived from investment funds do not have any tax benefit, as they are included in accounting profit taxed by the Corporation Tax.
- Diversification: The funds invest in a set of securities or financial markets, reducing the investment risk in comparison to products that invest in only one security or market. Diversify means reducing the investment risk and receiving smaller fluctuations in medium and long-term returns.
TYPES OF INVESTMENT FUNDS
The classification of investment funds corresponds to certain criteria such as the risk, return on investment and term. At Unicaja Banco we offer a wide range of investment funds that you can find here.
