Unit Trusts as a Valuable Addition to Your Portfolio

It goes without saying that the best type of portfolio is a well-diversified one. Unit trusts are a healthy addition to your long-term investment portfolio, and a veritable option to consider as you plan your investments for the year. Some of the reasons to consider unit trusts include: 

1. Short-term emergency fund: Unit trusts are a good store of value for your cash, while remaining easily accessible. In addition, unlike cash, unit trusts can keep up with inflation or at-least help you retain some of your purchasing power in spite of inflation.
2. Diversification: Unit trusts tend to be inherently diversified in their nature. For example, a share-based unit trust tends to have multiple (more than 20) holdings, and these are typically spread out through different industries. This means for the individual investor that they get their diversification going from the on-set, when investing in unit trusts.
3. Cheaper alternative: Some investors might be inclined to invest in property, or commodities, while not being financially ready to make a large property purchase. There are specialist unit trusts that invest in, say, healthcare, or property, or commodities that could help get these individuals invested in their asset class of choice at a fraction of the cost of investing directly.

Unit trusts are a valuable addition to your portfolio for both the short-term and long-term and can be a good store of value whi?le you weigh your options.

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