What is an investment fund

We'll explain how investment funds work and their different advantages

Investment funds are Collective Investment Institutions which are set up for the purpose of pooling contributions from a variable number of investors (shareholders), in order to manage those contributions so as to get a return while ensuring a suitable diversification of the risk. This definition alone does not fully explain what an investment fund is. That's why we explain the different elements involved in an investment fund below. 

Each participant is an owner of part of the fund's assets in proportion to the value of their contributions. The result of the investment (increases or decreases in asset value) is attributed proportionately to the participants.

Upper banner calculate returns Upper banner calculate returns
Takes out party to your money
Choose the best investment fund for your needs.

Since they are not legal entities, investment funds "transact" with others (shareholders, intermediaries, markets) through two entities:

  • The Manager that jointly invests these contributions in different financial assets (fixed income, equities, derivatives or any combination of these) following guidelines set out in advance in the fund investment policy.
  • The Depository that has custody of the fund's assets (shares and cash) and assumes certain regulatory functions over the Manager for the benefit of the participants.

Apart from knowing what an investment fund is, it's also a good idea to consider the benefits they offer small investors: 

Diversification: through an investment fund you manage to distribute your money in different assets / sectors / markets that have different behaviors in the same market situation. This way, if one or more of them generate losses, they may be offset, at least partly, by the gains of another or others.

Access to practically any market: you will have access to markets that in many cases would not be within you reach if you invested individually.

Efficiency: by investing as a group, you can take advantage of economies of scale. This will help you cut the cost of performing transactions on the market.

Central banner Central banner
Fund Finder
Discover the BBVA investment fund catalog.

Professional management: by investing in funds you entrust a portion of your savings to a professional team with a greater capacity to analyze and follow the markets than a retail investor.

Products suitable for every profile: there is a wide variety of types of funds, which allows you to find products for any investor profile, from the most conservative to those that are prepared to take on greater risks.

Finally, remember that, as with any financial instrument, investments in investment funds are subject to market fluctuations and the risks inherent to investing in shares. Investment funds are within reach of all savers. It does not matter if you are not familiarized with this type of product: At BBVA, we have a wide range of investment funds adapted to your profile and a professional team at your disposal to answer all your questions.

CTA subhome funds CTA subhome funds
Banner Asset Management Banner Asset Management
With the collaboration of BBVA Asset Management:
Investment funds - You might also be interested in Investment funds - You might also be interested in

You might also be interested in

  • Learn about the characteristics, types and description of what we know as financial assets.
  • We'll explain how investment funds work and everything you need to know about investing your money.
  • Reduced risk and known, guaranteed returns are two of the characteristics of a fixed-income investment.
Investment funds - Tools Investment funds - Tools

Investment fund tools

  • The BBVA investment fund calculator helps you to find out the returns you can get with your savings.
  • You don't know which investment fund best suits your needs? Our comparison tool will help you choose the best option.
  • Find the best investment fund in which to invest your savings and start to get a return on your money.
  • Calculate the returns of an investment quickly and easily using the calculator we provide you.