Fund managers are known to make it easy for you to monitor and manage your funds. There is no doubt about that. And if you stumble upon a reliable fund manager then you can be ensured of the best financial advice as well. But you should always keep a close watch on your portfolio. No matter how reliable a fund manager or fund management company is it would be a bad idea to blindly trust them and leave them to work on autopilot mode. Here are few things your fund manager would not be telling you:
This doesn’t happen all the time. But did you realize that if the fund managers are so good at managing the funds and investment portfolios why is every investor not being able to make huge profits? There are situations where investors even face losses in spite of relying on the best fund managers. Such situations might be because the fund manager took a huge risk. There might be situations where the fund manager is in a hurry to meet some targets or some demands in his job profile. So he might end up taking a risk hoping for larger returns in a short period.
Invest in stocks that the manager might not really know about
Some fund managers, especially those with a lot of experience might start relying a lot on their instincts. The stock market analysis is tedious, whether it is done by the investor himself or his fund manager. Some fund managers, those with a lot of clients to handle might sometimes start taking impulsive decisions. They might choose stocks that they do not know about fully. It is true that they would be able to guess the performance of the stock by looking at a small amount of information and it is relatively easier for them. But it is not a good idea to pick stocks whose story they do not fully know about.
Fixed income funds are not always going to fetch fixed incomes
The name is misleading. Fund managers might lure you into investing in them. But remember that they are not literally fixed income plans. Even these funds are prone to fetch losses sometimes. The risks might be less than the other managed funds but these definitely are not zero risk options as they are perceived to be.