Buy mutual funds 2022: best funds in comparison

Mark Norgate
October 1, 2021

By definition, funds are interest groups. Often several thousand people pool any amount of money, and the fund manager then invests this money according to previously defined rules.

Investment funds can therefore represent an attractive solution for long-term investments. The depositors’ assets are then distributed across various investment options.

Table of Contents

Buying mutual funds – what should you look out for?

The following points should be considered when buying uranium stocks:

  • Does buying mutual funds make sense? Which mutual fund returns can you expect? Mutual funds are a simple way to manage your assets and, in the best case, to increase them with a high yield. Investment funds offer the advantage that you don’t have to worry about managing your capital, you just have to invest your money in the fund. However, the management fee from the mutual fund can greatly reduce the return compared to ETFs.
  • Where can I buy mutual funds? Investment funds can be purchased from any online broker. However, we recommend our test winner broker ETFinance. In our opinion, ETFinance is the absolute best stockbroker, as you can buy stocks and ETFs here completely free of charge.
  • How can you pick the best mutual funds? The selection of investment funds is essential but not easy to answer the question. Of course, you can transfer past performance to the future. Still, when choosing the investment fund, you should look at your financial disposition, willingness to take risks and the current economic situation.

Promising mutual funds in 2021:

Fund name1 month6 months1 year3 years5 yearsten years
AB I Sustainable Global Thematic Portfolio Ax2.48%22.38%29.27%51.84%76.84%187.78%
Quantex Global Value Fund EUR R6.54%15.94%11.88%35.65%54.15%
Allianz Interglobal A EUR3.81%12.97%13.14%43.24%69.46%205.65%
Comgest Growth World EUR Dis3.15%10.90%11.95%39.59%
Nielsen Global Value B.4.39%27.19%28.17%33.04%35.96%110.19%
UBS D Equity Fund Global Opportunity0.48%11.98%12.77%35.13%47.22%177.45%

Where and How to Buy Mutual Funds? Best brokers in comparison:


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Buy investment funds: step by step instructions


Step 1: Find the right depot

Before you think about a mutual fund, you should find out about the right portfolio. The following explanation will help you to find the right portfolio for your mutual fund. A mutual fund is an account that can be used to trade and hold mutual funds.

If you are interested in mutual funds, you must zunächs t at your local bank or at an online broker a safekeeping account. Only then you can buy and sell securities.

However, the custody account management fees are significantly higher at branch banks, but the advice is more personal – with an online broker, you are responsible for your investment yourself.

If you want to open an investment custody account, a voluntary self-assessment is required, summarising your previous experience in securities trading and your investment goals. You will then be assigned to a risk class. You do not have to disclose this information to open a securities account, but you may be denied risky business without a self- disclosure.

You can also manage your deposit as a joint account and thus share it with your spouse. With an AND account, the two account holders can only carry out the transaction together, making the OR accounts more popular – both holders can access the account alone.

We recommend a deposit with our test winner broker ETFinance: Here, the purchase of shares is completely free of charge. In addition, ETFinance is fully regulated and licensed.

Step 2: Find the right investment fund: best investment funds in comparison

There are many different fund types and strategies. It is important to compare them before making a decision. Here is the most important information about equity funds, bond funds, mixed funds, money market funds, funds of funds and real estate funds.

Equity funds

In stock fund investors’ money is invested in company shares. Depending on the focus, the fund manager can choose from companies in a specific country, industry, or region. As a result, the investor becomes a partner in companies and participates in their profits in dividends.

With the purchase of several stocks, the fund manager puts together a balanced share portfolio to compensate for the price fluctuations of the individual positions. As a result, the value of the custody account fluctuates far less than the prices of the individual stocks contained in the fund.

Pension funds

Annuity funds have nothing to do with an annuity. They are called that because bonds that annuity funds invest in yield a kind of annuity interest. An investor lends money to a debtor, such as a company.

The borrowed capital will later be paid back with interest, it is regulated in advance when and in what rhythm the money will be paid back. However, it is not possible to predict how the general market interest rate will develop.

Money market funds

Money market funds are invested as overnight money, bank balances, and in the money market. Better interest rates can be negotiated with the banks than a private investor could with the existing investment money.

The risk should be small due to the short duration of the investments and the choice of banks and bond issuers, but the opposite was the case for some funds during the financial crisis. Money market funds are therefore less of a financial reserve that is available at any time and more of a kind of “parking lot”.

Mixed funds

You don’t always have to differentiate between different investment funds because mixed funds are a kind of “ two-in-one solution” : With a mixed fund, you can decide to invest more in stocks, currencies or secure interest-bearing securities.

It has also been allowed for a few years to invest part of the money in real estate funds if it is determined beforehand how high the share of each individual security class should be in the fund’s assets. Thus, mixed funds can certainly function like full asset management.

Real estate funds

Real estate funds do not only work in mixed funds. You can buy shares in land and buildings with real estate funds – even if you do not have the capital to purchase a property directly. Real estate funds invest in commercial properties such as office buildings, shopping centres or warehouses, not private residential buildings.

When you buy shares in real estate, you are entitled to long-term growth in value , but high-quality and profitable properties in which the capital can be invested sometimes have to be found first. If the purchase is delayed, the money is “ parked ” in fixed income securities.

Fund of funds

For more security, you can use as investors funds to buy, that is, funds that have shone in their respective fields by stable investment results, rather than investing in bonds, stocks or real estate.

Therefore, the fund of funds is a kind of mixed fund. The difference is that the fund manager does not invest directly but rather through appropriate funds in individual asset classes and capital markets. A small disadvantage with funds of funds is that the one-time and ongoing costs of the fund of funds are joined by the costs of those funds that are brought into the custody account.

Step 3: invest in funds

Now it’s about buying investment funds . To do this, look for the “ Portfolios ” section and then “ Funds ”. Now you can see a large selection of ETFinance “Copy Funds” or “Copy Portfolios” in which you can invest.

After deciding on a fund, click on ” Invest ” to open a dialogue window with purchase settings. Here you enter the amount that you would like to invest in the fund.

As soon as you have pressed the ” Invest ” button, the investment in the investment fund is complete!

What is a mutual fund? Our simple explanation and definition:

Depending on the type of fund, the fund manager acquires real estate units, stocks or bonds whose return prospects appear to be particularly profitable. This means that if you, as an investor, buy fund units, you are entitled to part of the collective investment income.

An investment fund is a collection of various assets based on the principle of risk distribution, also known as diversification, for example, securities, real estate or goods. The goal of an investment fund is a portfolio with the highest possible return with the lowest possible risk.

A capital investment company (KAG) bundles the funds of numerous investors. Management is carried out by a fund manager who decides with experience in which investments a fund invests.

The investment conditions and investment principles form the framework for this decision, the fund and the statutory investment limits. A fund manager is also required not to invest more than 5% of the fund’s capital in the securities of a single company.

Buy investment funds at ETFinance


You can find a large selection of mutual funds at ETFinance. Here is a step-by-step explanation for your mutual fund. The difference between funds and stocks is that it is important to distinguish between stocks, individual stocks and funds. Single security is certain security – for example, a share of a single company, a federal bond, or a company bond.

A fund is like a pot in which several different stocks are collected and put together with a certain focus, such as industry, region, or type of securities. However, in contrast to stocks, which you have to manage yourself, the fund manager takes on the management of your stock funds.

You also have more security because you invest in different assets with funds, thus diversifying funds and reducing risk. Another advantage of diversification is that a relatively small amount can be invested in a diversified manner.

Open fund or closed fund?

In addition to the various fund types, funds can also be differentiated according to the type of capital they raise, their distribution behaviour (are the income reinvesting or distributing?), Their investment focus and their type of fund (open/closed).

The comparison is worthwhile and gives more security in the investment. The following explains the differences between open and closed funds.

Open funds are accessible to everyone and spread their money over many asset classes. In the case of open funds, shares in the KAG can be bought or sold at any time. Open investment funds are like huge, open pots of money into which you can put money at any time and from which you can withdraw your money at any time without waiting a certain time.

These funds are also quite transparent, as they regularly publish which securities they hold and how much each fund unit is worth. In addition, closed-end funds often only buy a single object, such as a company or a property; the contributors to closed-end funds thus form a joint- venture, whose participation usually only ends after years, when the object is sold and turned into cash.

Closed-end funds are therefore limited in the possibility of buying or selling shares in the KAG at any time.

You can also view the current top funds on ETFinance. However, the fund prices provided by the KAGs always relate to the previous day, which means that if you buy or sell your fund units today, you will only be able to see the KAG’s issue/redemption price for your purchase or sale on the next stock exchange trading day on ETFinance .

What is the difference between active and passive funds

Open funds can be divided into active and passive funds. Each active fund is managed by a fund manager, who determines what and what shares go into the fund, plus the securities if the fund manager considers them to be promising, he receives the management fees from the investors for his work.

Ideally, these additional costs are worthwhile, as the fund manager’s experience enables him to achieve more returns than investors would get if they bought the index.

Fund units are also protected in the event of a bank failure, as they are considered special assets and guarantee more security. Passive funds, so-called index funds (ETF) , do not have fund managers, so they lower fees. For example, in the case of an index fund on the South African stock index, the fund company puts exactly the 30 stocks in the pot with the same weighting as represented in the Dax.

If the index rises by one point, the fund’s value also rises by one point – and vice versa. Such funds, therefore, always deliver roughly as much as the market average. Passive funds, therefore, have the advantage that they mean fewer fees for the investor and cannot perform worse than the market average.


Best South African investment funds in comparison

Sustainable investment funds

In sustainable investment funds, strategies and a financial return or ethical, ecological and social aspects are included. Investments are only made in companies and countries that meet certain sustainability criteria. Sustainability funds should show a good performance and bring the additional added value of fulfilling a social benefit.

There is currently a large supply of sustainable investment funds as the demand has risen sharply in recent years. If you are interested in sustainable mutual funds, it pays to turn to independent databases. These include CleanVest, EDA and the forum for sustainable investments, FNG.

ETFinance Copyfonds: How good are ETFinance’s copy portfolios?

Copy portfolios are said to be the next generation investment product. It is ETFinance currently the leader. Here you can invest in two different types of copy portfolios. On the one hand, there are top trader portfolios, which are made up of the traders from ETFinance with the best performance and greatest sustainability, and on the other hand, there are market portfolios.

Market portfolios bundle shares CFDs, commodities or ETFs within the framework of selected market strategies.

The ETFinance Copy Portfolios (or formerly ETFinance Copyfonds ) aim to help investors minimize long-term risk , promote growth opportunities and create diversified investments. As soon as you invest in an ETFinance CopyPortfolio, the capital is professionally managed by ETFinance’s investment committee. In addition, the value development of individual CopyPortfolios is also intensively analyzed and balanced in order to achieve maximum profit.

Calculate the costs of an investment fund


In contrast to stocks, investors in investment funds have running costs, the majority of which are summarized in the TER (Total Expense Ratio). In any case, you should keep an eye on the costs, as they reduce the return in some cases.

There are some ancillary costs due to buying and selling investment funds , which can reduce the return. In addition, the more often you buy and sell, the higher the commissions and fees. Therefore, you should pay particular attention to the fees, as some forms of investment cause high costs that can result in losses.

If you buy a conventional investment fund, the following costs arise: The investment company pays an initial charge, which, depending on the investment focus, can be between 3 and 6 percent before your fund can show an increase in value.

Some mutual funds take a year or two just to recoup the fees . Funds also charge an annual management fee of between 1 and 2 percent.

In Germany, the average annual management fee for equity funds is 1.4 to 1.5 per cent. If you want to find out more about the fees charged to your fund, look for the key figure (TER – Total Expense Ratio: total expense ratio) for your fund, which shows the amount of the fee charged as a percentage. Most mutual funds have a 1 to 2 per cent total expense ratio.

Advantages and disadvantages of mutual funds

  • No need to spend a lot of time
  • Good network with experienced people
  • Often well-diversified, low-risk funds
  • Participation with low capital investment
  • Returns depend on other people
  • High management fees
  • Lack of voting rights

There are advantages and disadvantages to investing in mutual funds .

Advantages of mutual funds

The biggest advantage of mutual funds is that you save yourself a lot of time because you don’t have to actively worry about investment decisions, such as buying and selling stocks, shares or real estate. In particular, the management of real estate is very time-consuming due to the lease agreements, new tenants, maintenance and utility bills have to strive.

Investing your money in real estate funds allows you to benefit from the real estate market without spending a lot of time. Your fund manager takes care of this, and you can then follow the success of the value of the unit certificates.

Another plus is that the fund companies have employees who deal with increasing money daily and who have a lot of experience in the investment sector. As a result, they have a good network with many sources of information from which they can benefit.

Due to many investment company employees, there are more opportunities for interesting investments that individual investors probably would not have noticed. Since there are many investment opportunities, it is difficult to keep the same overview of the market on your own.

Buy property directly or use funds?

Real estate in particular, is complicated to evaluate without looking at the property on site. Due to the regional representation of the fund companies, you are also represented on-site, even if you cannot be there in person. You also have the advantage that the capital of several investors is bundled, and you thus have more options than individual investors.

Commercial real estate, in particular, is usually more profitable but also more expensive than residential real estate, and it is precisely these sums that cannot be borne as an individual investor. However, you can also invest with your capital through an investment fund, as you can also participate with smaller income.

Not only do the investment opportunities increase, the investment risk is also reduced and thus provides more security for the investor. Many investment funds bundle over 100 individual investments. Even if you invest small amounts in a fund, you automatically benefit from the fund’s risk diversification.

Disadvantages of mutual funds

One disadvantage is that the return does not depend on the strangers the fund company employs. This can be an advantage or a disadvantage, depending on who is responsible for the return and the fund. Some funds bring good returns, others moderate to poor returns.

It is therefore advisable to find out about fund developments in advance. Furthermore, the costs above of a mutual fund are another disadvantage that you have to be aware of, because you have to pay the costs for a fund via a front-end load or via the fund’s assets.

These costs impact the return and mean that it is below the benchmark index in which the investment fund has its investment focus. Therefore, it would be an advantage to invest directly in this leading index to keep costs low.

The high sums available to the funds also increase the pressure to generate the corresponding return. This means that the returns are often invested and have a similar trend to the benchmark index in which the fund has its investment focus – that is, it would incur low costs to invest directly in the benchmark index via an index fund.

Investment funds: the bottom line

Advantages for the investor of a fund are the administration of the fund by fund managers; Diversification of risk; participation with little capital investment.

Disadvantages of a fund are, among other things, weakened profit performance and the lack of voting rights.


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The saying-who wants more, has to dare more- also applies when investing money. Because every plus in return means additional risk, however, this can be balanced well with funds; in addition, each fund is exposed to the same risks as the market in which it invests. Open real estate funds have also been popular for expenses long time, but many investors have been afraid of investing since the financial crisis and the resulting real estate crash. So if you’re someone who thinks long-term and can keep calm when prices go down, you should invest in equity funds because the longer the investment, the lower the likelihood of price losses.

Yes, because funds are not like building society contracts or endowment insurance. With open funds, you are not tied to a certain time limit, and if you need cash, you can sell as many fund units as you want without notice.

Beware because the best fund is not always the one with the highest returns! The greatest security is provided by funds that have generated additional income over the long term compared to competing products.

The fund volume, i.e. the sum of the deposited money, does not yet guarantee quality. So big doesn’t mean better. The same applies to new funds – new funds first have to prove that the concept works, but a long lifespan is not a guarantee of success either.

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