REGULAR
SAVINGS - ONE WAY TO OFFSET
INVESTMENT RISK WHEN MARKETS ARE VOLATILE
Choosing when to invest can be
difficult at the best of times, but even more so during
times of stockmarket instability.
For investors who are unsure about the right time
to buy, the IMA has updated its free factsheet, ‘Monthly
Savings – A guide to building up capital in investment
funds’. This
explains the benefits of saving in regular instalments and
how they can offset the risks involved with market timing.
Callers to the Unit Trust Information
Service save, on average, £98.30 per month*, but saving
even £50 per month would still create a tidy nest egg.
For example, a £50 monthly savings plan taken out
in March 1992 would now be worth £8,683.**
But some savings plans start from as little as £10
per month and the money can still mount up over the long
term.
Unlike a lump sum investment, a
regular savings plan helps investors avoid the trap of
committing all their money to the stockmarket at possibly
the wrong time. By
investing at a different price each month, the costs of
your units will even out over time.
Clare Arber, Head of Communications
at the IMA commented:
“Investment
fund savings schemes are a highly efficient way of saving
for the long term, particularly for investors with limited
resources. With
just a small monthly outlay, a sizeable capital sum can be
built up over time. Furthermore,
regular savings not only reduce the effects of market
fluctuations, but can also be a benefit when markets fall,
helping investors acquire units at a lower price.”
This factsheet can be obtained free
of charge from the Unit Trust Information Service by
calling 020 8207 1361 or on the IMA website at
-
ends -
For further information, please contact:
Clare
Arber, Head of Communications, IMA, 020 7831 0898
Helen
Stephenson, PR Assistant, IMA, 020 7831 0898
Notes to Editors:
*Source – Unit Trust Information
Service Survey 2001.
**Source – Quarterly Chartpack,
Investment Management Association
Based on £50 regular saving over 10
years to end March 2002 in UK All Companies fund with net
income reinvested. Standard and Poor’s Micropal.
The Association of Unit Trusts and
Investment Funds (AUTIF) and the Fund Managers’ Association
(FMA) merged to become the Investment Management Association
on 1 February 2002.
The Investment Management Association
publishes a number of useful factsheets to help savers to
understand unit trust and OEIC investment.
