Too many investment choices? Here’s why that’s actually good news

The investment landscape keeps changing significantly. Today, there are more unit trust funds available than individual shares on the stock exchange, a trend that is attributed to several company’s delisting from the JSE, which has become a noticeable trend over the past decade. It’s not driven by one single issue, but rather a combination of structural, economic and strategic factors such as high cost of listing, regulatory and governance pressure, and tight competition from private equity firms.

Understanding unit trust options can feel overwhelming due to the vast universe. But with the right guidance, this abundance of choice is an opportunity to put emphasis on the value of financial advice and to build an investment strategy that is aligned to a client’s financial plan. At Imvelo Wealth, we believe investing should not be about chasing products. It should be about building a financial plan that is aligned to a client’s financial goals and objective. We help clients cut through the noise by:

• Filtering funds based on investment philosophy, consistency, and track record
• Aligning fund selection with client goals rather than trends
• Using fund screening tools and research houses to identify quality managers.

In a landscape where choice is abundant, your financial planner becomes a strategic curator of the clients’ investment portfolio.

From product overload to personalised strategy

The ease of access to an abundance of unit trusts investment options gives financial planners the ability to create investment portfolios with greater precision.

Instead of a one-size-fits-all portfolio, advisers can blend funds across asset classes, geographies, and styles as well as match portfolios to specific client objectives (income, growth, capital preservation). There is also the option to incorporate values-based investing such as ESG and Shari’ah-compliant funds.

This allows for goal-based tailored portfolios, which strengthens client outcomes and engagement, and is where advice matters most – not in picking ‘the best fund’, but in selecting funds that will meet the client’s risk tolerance and expected long-term returns. 

Diversification means smart investing

Unit trusts make diversification simple and accessible, as investment is spread across multiple assets, sectors and even global markets. This reduces risk and creates a more stable investment experience over time. Diversification allows investors to benefit from sustainable long term returns; access to single and multi-manager strategies, access to active and passive management strategies and greater resilience in uncertain markets. 

Expert management, without the complexity

I encourage clients to consider consulting with a certified financial planner who can provide comprehensive financial advice and guidance when constructing investment portfolios to ensure that they are correctly invested.

Unit trusts give you access to professional fund managers who:

• Analyse markets daily 
• Have the skill and experience to make informed investment decisions 
• Adjust portfolios as conditions change. 

Professionals allow clients to stay focused on their lives and have the peace of mind of knowing they have someone who will assist them reach their financial goals, and that their investments are being managed with expertise and care.

Cost-efficiency and tax-efficiency

Unit trusts offer both cost-efficiency and tax-efficiency, making them a compelling choice for long-term investors. Their ability to pool money from many investors creates economies of scale, resulting in lower trading costs than an individual would typically incur when managing their own portfolio. This also provides access to diversified investments without requiring significant upfront capital. On the tax side, investors are taxed only on the distributions they receive, whether income, dividends or capital gains. When unit trusts are housed within vehicles such as Tax-Free Savings Accounts (TFSAs), endowments or Retirement Annuities (RAs), their tax benefits are further enhanced, supporting more efficient wealth accumulation over the long term.

Supporting goal-based and long-term investing

One of the most powerful drivers of investment success is consistency. When clients invest on a monthly basis, they benefit from the principle of compounding interest, which ultimately increases the investment value through the reinvested interest. Unit trusts are well-suited for goal-based investing because they enable regular contributions (debit orders); benefit from compounding over time and offer different risk-return profiles aligned to time horizons. 

For long-term goals like retirement, education, or wealth building they encourage discipline and consistency, reduce the temptation to time the market, and allow advisers to track progress against defined financial goals.