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Learning center | Investment Unit

What is Investment Unit (IU) ?

Types of Investment Units (1)

Types of Investment Units (2)

Types of Investment Units (3)

Retirement Investment Unit

Long-Term Equity Fund (LTF)

Property Fund

Treasury bill

What is Investment Unit (IU)?

An Investment Unit (or "Mutual Fund") is a financial product of Asset Management Company (AMC) that pools the money of many investors -- its unit holders -- to invest in a variety of securities. Investments may be in stocks, bonds, money market securities or some combination of these. Those securities are then professionally managed on behalf of the unit holders. Each investor holds a portion of the portfolio, and is entitled to any capital gains, dividend interests, and rights, but is also subject to risk of loss in value.

Why invest in Investment Unit?

There are several benefits to investing in Investment Units (IU's). Although each individual investor may have different reasons for investing, some of the main benefits for investing in IU's are professional management, diversification, capital appreciation, convenience, and perceived safety.

	Professional Management One of the benefits of investing in Investment Unit is the active oversight and investing management experience of an assigned fund manager. Within an asset management company, the fund manager is responsible for overall management of the portfolio to include purchasing and/or selling shares.
	Diversification Most individual investors, with a limited amount of assets, are unable to adequately diversify their holdings. Rather than placing an entire investment in one or few individual stocks, investment units can help investors to manage their risk by diversifying their portfolio.
	Wide range of investment options Investment Units are purposely built to match various types of investors' investment objectives and financial resources. For this distinct character, each investor can easily find their investment options from pool of Investment Units. Therefore, investors can select one or a small group of Investment units to meet their investment objectives and financial resources without having to inconveniently combine different investment products themselves in order to reach the same result.
	Convenience Investment Unit investing allows for several conveniences. For example, Investment Units allow for easy purchase and redemption of shares (or Units).
	Liquidity Shares/Units in a mutual fund may be sold whenever you want. At your request, a fund is required to redeem shares on any business day, based on that day's closing price-the Nett Asset Value (NAV) of the securities within the fund (although redemption fees apply to some funds). Net Asset Value is the share/unit price, or market value, of a fund's total assets, less its liabilities, divided by the number of shares outstanding.
	Investor Protection Securities and Exchange Commission (SEC), Aassociation of Investment Mmanagement Companies (AIMC) and trustee are three main parties who regulate, standardized and monitored Investment Units. They help to set business regulations and structures. Moreover, they require Investment Units to provide full disclosure of information an investor needs to make an informed decision. All these in turn ensure investors for fair business practice of Investment Units.

This table shows the parties involved in Investment Unit.

Warning: Investment Units, unlike bank deposits, are not insured and guaranteed by Thai government. The market value of Investment Units may fluctuate or expose to the risk of an investment falling in value. By holding a large number of securities, Investment Unit holders may give up the chance to earn the higher returns that are sometimes achieved by holding a single security or a handful of individual securities. In addition, investors should consider investment expenses such as fees that come together with IU's, sometimes, these expenses may erode the returns you receive as an Investment Unit holders.

Last updated: 1st July 2003

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