Avoid These 10 Investments In 2014

BANGALORE: Investing, be it for retirement or to just generally grow your wealth, must be done carefully. If you don't use good judgment when putting your money somewhere, you will find that it leaves you rapidly.

There are a few good investments out there and a bunch of gimmick ones that only earn money for the people selling them. Let's take a look at some of those and see why they are not what they are cracked up to be.

1. Fund of Funds

There is no need of investing in such funds. FOF fund is fund that will invest in other mutual funds. A fund of funds allows investors to achieve a broad diversification and an appropriate asset allocation with investments in a variety of fund categories that are all wrapped up into one fund. However, if the fund of funds carries an operating expense, investors are essentially paying double for an expense that is already included in the expense figures of the underlying funds. Diversification is good, over diversification is not. FOF are expensive, where the management fees are paid twice.

There is good amount of chance that you will invest in the same stock through different schemes. The returns of equity diversified funds are better than Fund of Funds in long run.