Intelligently building wealth in the long term
Discover the world of investment funds with nextsure. Professionally managed portfolios for your wealth building and retirement planning – digital and transparent.
Diversified portfolio
Professional Management
Flexible investment strategies
Understanding Investment Funds: Your Path to Successful Wealth Building
Broad risk diversification through pooling of capital.
Access to professional fund management and expertise.
Diverse asset classes and strategies available.
Ideal for long-term wealth building and retirement planning.
What are investment funds and how do they work?
Investment funds are investment instruments that pool the capital of numerous investors to collectively invest it in a broadly diversified portfolio of securities such as stocks, bonds, real estate, or commodities. The management of this portfolio is the responsibility of a professional fund management, which makes investment decisions based on defined strategies and market analyses. Investors purchase shares in the fund's assets, which are held as special assets separate from the assets of the fund management company, thus protected in the event of the company's insolvency. The value of a fund share is derived from the total value of all assets contained in the fund, divided by the number of issued shares. Capital gains and income such as dividends or interest add to the fund's assets, increasing the share value or being distributed to investors. Investment funds therefore offer private investors with smaller amounts the opportunity to participate in the capital market in a diversified and professionally managed manner.
Your Benefits
Investment funds at nextsure
Diversification
Minimise risks through broad diversification of your capital.
Professional know-how
Benefit from experienced fund management and market analysis.
Flexibility
Trade shares daily on the stock exchange, savings plans starting from small amounts.
Investment opportunity
Take advantage of the long-term growth potential of the capital markets.
Sustainability
Invest responsibly in forward-thinking ESG funds.
Retirement planning
Systematically build wealth for your retirement.
Theme funds
Invest specifically in innovative sectors and mega trends.
Digital Processes
Easy access and management of your fund investments online.
Transparency
Clear information on costs, strategies, and performance.
Discover smart investment solutions for your financial future.
Ready to build your wealth?
Discover suitable investment funds now.
The key advantages of investment funds for your financial investments
Investment funds offer investors a number of significant advantages. First and foremost is risk diversification: because the fund's assets are distributed across a variety of different securities, asset classes, regions, or industries, individual negative developments can be cushioned more effectively than with a direct investment in just a few securities. Secondly, investors benefit from the expertise of professional fund management. Experts continuously analyse the markets and make informed investment decisions, which is particularly beneficial for investors without in-depth knowledge of financial markets or time for their own research. Thirdly, investment funds enable access to markets and asset classes that are often difficult or only accessible with great effort for individual investors. Last but not least, funds offer high flexibility: shares can usually be bought and sold on a daily basis, and savings plans allow for continuous asset accumulation starting from small monthly amounts. This combination makes investment funds an attractive building block for different investment objectives, from short-term investment to long-term retirement planning.
Variety in the Market: What Types of Investment Funds Are There?
The market for investment funds is extremely diverse and offers suitable products for almost every investment goal and risk appetite. Among the most well-known types are equity funds, which mainly invest in stocks of various companies and offer higher return opportunities at correspondingly higher risk. Bond funds predominantly invest capital in fixed income securities (bonds) and are considered less risky, but generally provide lower return potential. Mixed funds combine different asset classes such as equities and bonds to achieve a balanced risk-return profile. Money market funds invest in short-term interest-bearing securities and are often used for short-term liquidity management. Real estate funds invest in real estate projects or portfolios. Index funds (ETFs), which passively track a specific market index (e.g., DAX), are gaining in importance due to their low costs. In addition, there are special funds such as fund of funds (invest in other funds), thematic funds (focus on certain industries or trends such as sustainability) or capital protection funds (offer capital protection to a certain degree). The choice of the right fund type significantly depends on your individual investment goals, investment horizon, and risk tolerance.
Investment funds and risk management: Seize opportunities, manage risks
Every investment carries risks, but investment funds offer inherent mechanisms for risk management through their structure. The core principle is diversification: by spreading the investment capital across many different securities, the risk of a total loss from individual positions is reduced. If the value of one security falls, others can potentially compensate for this. Fund managers also actively monitor the portfolio and adjust it to market changes (in actively managed funds). However, investors should be aware of specific risks: market/price risk (value fluctuations), interest rate risk (for bond funds), currency risk (for investments in foreign currencies), or sector-specific risks. To manage risk individually, it is important to choose funds whose risk profile matches one's own risk tolerance. Many fund companies classify their products accordingly. A long investment horizon also helps to weather short-term fluctuations and benefit from long-term market trends. Careful selection and, if necessary, the inclusion of lower-risk asset classes are key elements of solid risk management when investing in investment funds.
Transparency is key: An overview of costs and fees for investment funds
When investing in investment funds, various costs and fees can reduce returns. Therefore, it is important to understand these thoroughly. The initial charge is a one-off fee payable when purchasing fund shares and usually represents a percentage of the investment amount (typically 0-6%). However, many direct banks and online brokers offer funds with reduced or waived initial charges. The management fee is charged annually for the management of the fund's assets and is deducted directly from the fund's assets. Its amount varies depending on the type and strategy of the fund (actively managed funds are usually more expensive than passive ETFs). Additionally, a custody fee may be incurred for holding the fund units in a securities account. The Total Expense Ratio (TER), also known as the total cost ratio, summarises the ongoing costs of a fund (mainly management and custodian bank fees) and is expressed as a percentage of the average fund assets per year. However, it does not include all potential costs, such as transaction costs within the fund. Therefore, when comparing funds, pay attention not only to the performance but also to the cost structure, to realistically estimate the net return.
For Beginners
Basic Savings Plans
For Experienced
Specialised Funds
For Visionaries
Sustainable Investments
Investing with an eye on the future: Sustainable Investment Funds (ESG)
Sustainable investments, often summarised under the acronym ESG (Environment, Social, Governance), are becoming increasingly important to investors. Sustainable investment funds consider ecological, social, and ethical criteria, as well as good corporate governance, alongside financial aspects when making investment decisions. The aim is to channel capital into companies and projects that operate responsibly and make positive contributions to society and the environment. The specific investment strategies may vary: exclusion criteria (e.g., no investments in arms manufacturers or coal producers), best-in-class approaches (investing in the most sustainable companies within an industry), or thematic investments (e.g., renewable energy, clean water). For investors, sustainable funds offer the opportunity to align their financial goals with their personal values. Studies also suggest that a sustainable orientation need not compromise returns in the long run and can even have positive effects, as companies that act sustainably are often more resilient and innovative. nextsure supports you in finding suitable sustainable investment funds for your portfolio.
Investment funds as a component of your private retirement plan
In light of declining benefits from the statutory pension insurance, private retirement provisions are becoming increasingly important. Investment funds can play a central role here, particularly for long-term wealth accumulation. Thanks to compound interest and potentially higher returns compared to traditional savings methods, they offer the opportunity to accumulate significant capital for retirement over many years. Fund savings plans allow for regular investments, even with small monthly amounts, thereby benefiting from the average cost effect (cost-average effect): more units are purchased when prices fall, and fewer when prices rise, which can smooth out the average entry price. Diversified equity funds or ETFs, which offer the highest long-term return potential, as well as balanced funds with a stable risk structure, are particularly suitable for retirement planning. The longer the investment horizon, the more riskier investments can be considered. Early planning and consistent implementation of savings goals are crucial to being financially secure in old age. Investment funds offer the flexibility and potential to achieve this goal.
Choosing the Right Investment Fund: What to Watch Out For
Selecting the right investment fund requires careful analysis and should be based on your individual needs. First, define your investment goals: What do you aim to achieve with your investment (e.g. retirement planning, wealth building, specific purchase)? Clarify your investment horizon: How long can and do you want to invest your money? Determine your risk tolerance: What level of value fluctuations are you willing to accept? Familiarise yourself with the different types of funds and their characteristics. Compare funds based on key performance indicators such as historical performance (note that this does not guarantee future returns), volatility (range of fluctuations), Sharpe Ratio (measures risk-adjusted return), and particularly costs (TER, entry charge). Use information sources like the Key Investor Information Documents (KIID), fund prospectuses, financial portals, and independent ratings. Pay attention to the fund's investment strategy and the expertise of the fund management. For beginners, broadly diversified ETFs on global indices can provide a good foundation. In cases of uncertainty, professional advice can be helpful in making an informed decision.
What is the difference between active and passive funds (ETFs)?
nextsure, your digital insurance portal, is expanding its offerings to provide you with innovative solutions in the area of investments and retirement planning. We understand that building wealth with investment funds is an important part of your financial future planning. Therefore, we focus on transparency, comprehensibility, and digital processes to make it easier for you to access selected investment funds. Benefit from a carefully curated selection of funds that cover various investment strategies and risk profiles - from established standard funds to modern, sustainable ESG investments. Our platform offers you detailed information, comparison options, and tools to support you in your investment decisions. By combining our specialized insurance solutions, you can develop a comprehensive retirement plan tailored to your individual needs. Discover how nextsure can accompany you on your path to successful and digitally supported wealth accumulation.
