When we hear our advisers say "high conviction funds" or similar, do they necessary reflect the views of the fund house?

Facts: Index ETF 99.99% outperform unit trust.

Why people buy?
1) Unit trust for people tight on budget, with $1000 you can own it & can RSP $100. ETF eg. VOO $300+ 1 lot & price keep going up, difficult to DCA if ur hands are tight.

2) sale charge for UT is 0% in some brokerage. So 100% go into investment.

3) Cashflow- stock give out dividend, quaterly, half -yearly or yearly. Some unit trust give monthly payout.

However, now got robo, unlike the past. Who also offer provide an opportunity for tight budget people to invest. Some brokerage got fractional trading.

Thus i would say those who invest in unit trust is mostly for monthly payout and capital preservation. Similar to SG dividend stock, but only different stock dont give monthly payout.

I second what Jing Wei said. Mututal funds and unit trusts rarely outperform the market consistently.

They make money via commission you pay them and that increases as long as you stay invested and continue to DCA/put in more money consistently. Their focus is to reduce loss by diversifying broadly as much as they can because retail investors who look for their money to be professionally managed by someone are those that tend not to understand the market well. They are usually risk aversed and rather not see big red numbers even if it comes at the expense of lower long term returns.

Thus, they have more confidence trusting professionals not knowing that the focus will not be on growth and performance but to get you to stay invested.

Many great investors like Peter Lynch have mentioned that their portfolio at times have dropped more than the market but they know those are opportunities to take advantage of. Many retail investors that do not understand the market will pull out and not trust their fund manager if such an approach was taken.

Hence, Fund managers have it difficult to meet targets with limitations to work with. The focus tend to end up reducing volatility and growth may hurt