What is a managed investment?
Investment returns
The concept of return, in its simplest form, could be defined as getting something back from your investment. There are two general components of returns from managed funds - distributions and unit price growth.
Distributions are the payments you receive throughout the course of your investment (usually on a quarterly basis). They consist of the earnings the fund has generated over the period and may include capital gains (from the sale of shares or other investments within the fund) or income (from dividends, interest or rents). Note that some fund managers will refer to distributions as the "income" return of the fund. For various reasons not all BT funds distribute 1. Visit Distributions for more information.
Unit price growth occurs when the value of the underlying investments in the fund increase over the period of your investment. The unit price of the fund will rise and fall according to the value of the underlying investments. You will only realise unit price growth when you sell your units for more than you bought them.
Shares and property are often referred to as 'growth assets' because they tend to provide higher unit price growth. Including growth assets within your investment portfolio is important because they are expected to earn a higher overall return in the long term, allowing you to build wealth over time. Find out more about the 4 Asset classes.