– Mutual funds are a place where there is a collection of investor funds managed by investment managers so that mutual funds are very suitable for investors. You don’t need to worry about managing it because there is already an investment manager.

Generally there are several types of mutual funds including stock mutual funds, money market, fixed income, and mixed mutual funds.

The cost to start investing in mutual funds is not always expensive. What’s more, now there are several licensed mutual fund applications that you can use without bothering to think about how your investment is managed properly. Interestingly, you can invest starting from IDR 10,000. Does not require large capital.

But, before starting to invest in Mutual Funds, you must understand the following terms.

Investment Manager

Investment managers are usually tasked with managing investor funds to be invested in various securities such as money markets, bonds and stocks. Don’t worry about your money being taken away. Of course this investment manager already has a permit from the OJK (Financial Services Authority).

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Custodian Bank

If you are a mutual fund investor you need to know what a custodian bank is. The task of a custodian bank is as a financial institution that maintains and stores mutual fund assets. Don’t worry because of course you have received approval from the OJK, you know.

Custodian banks are generally administrators who deal with investment managers and investors in recording all mutual fund asset investment activities.

Collective investment contract

The relationship between the investment manager and the custodian bank is contained in a mutual fund management contract. The rights and responsibilities of each party are set out in the Collective Investment Contract. The investment manager is certainly given the authority to manage the investment portfolio collectively. Meanwhile, the duties of a custodian bank, as previously mentioned, have the authority to act as a place for collective safekeeping of assets.

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