Choosing Mutual Funds and Methods used and Choosing the Right Time

I have a plan to invest in equity mutual funds. So I try to choose a stock mutual fund that is expected to meet 2 criteria, namely an investment manager and a stock mutual fund product. Because I want to save for a period of 5 years and because I also don't have large funds to invest at the beginning, I try to set aside 10% of my monthly salary income and I will save it every month through the mutual fund. I always buy the mutual fund at the beginning of the month when my salary drops at the end of the previous month.

This is included in the category of dollar cost averaging method. This method is very good if we do not have large funds at the beginning and want to keep saving consistently. We will get what we save 5 years later.

Because investing in mutual funds can be classified as long-term investments, it is very important to choose a good investment manager and product that has been tested in the previous year. Even though the mutual fund is a new product, we need to look at the background and other products of the investment manager.

Because we can invest in this mutual fund for longer-term goals or such as the cost of children's future education or investment for retirement. In the next chapter, we will discuss more about financial planning with a mutual fund strategy.

In buying mutual funds, there is a lot of debate whether there is a right time, some groups say that mutual funds are investments for ordinary people so there is no need to be too confused about how and why. The important thing is to buy and leave it alone. However, I personally think that buying an investment product must really understand the possibility of profit and loss, the risks and rewards as well as the strategy in order to produce more optimal growth.

I even remember that the thesis that I made with the aim of optimizing mutual funds in order to get a purchase method that can reduce the risk of loss by one of the lecturers was deemed unnecessary because mutual funds have been regulated by the investment manager in order to gain profits in the capital market.

But there is something I want to say that basically we as human beings want to gain and do not want to lose. There are several things that are contradictory in this world but the law is still absolute, the bigger the profit, the greater the risk or openness, nothing in this world is an investment that is not risky, and there are many other absolute things that we must be aware of. For me, although mutual funds have been regulated in such a way by the investment manager, we should also at least be educated to know how we buy until our investment is maximized.

I speak like this especially for mutual funds that have more funds under management in a volatile market.

Therefore, after we know how to look at investment managers, good mutual fund products, methods of buying, we also must not forget to remember that buying time is something we need to pay attention to in order to get the most out of what we have invested.

Approximately if in 1 month where there is a stock mutual fund, the increase or decrease will not be very different from the Indonesian Composite Index (Jakarta Composite Index), where the stock index at the beginning of the month was at its lowest point in that month. and at the end of the month has the highest point in the month. This means that by buying the stock mutual fund at the beginning and at the end of the month, which value will be more profitable? Of course the answer is to buy at the beginning of the month because we have managed to make a purchase at the lowest price.

This is indeed a very extreme example but that's what I mean that as ordinary investors, why don't we arm ourselves with a little bit of our analytical skills so as to produce more optimal results.

Maybe it looks small because we see that the purchase is only one time, but if we invest in mutual funds and manage to make purchases properly and correctly for 60× in a row (5 years) it will certainly be more leverage than buying for 60 × in 5 years by just haphazardly buying. In this chapter I will not go into detail about the timing of purchases and will discuss the market analysis section for equity funds.