| Informed investors who want to put their money | | | | index of comparable funds. Look at this literature. |
| to work to earn higher returns invest in stocks. | | | | If you are just learning how to invest, but realize |
| Unless you are an experienced stock picker who | | | | that you should invest in stock funds for growth, |
| really knows how to invest, your best option is to | | | | get started the easy and safest way. Start with |
| invest in stock funds. Unless you get investor tips | | | | a TOTAL MARKET INDEX fund or an S&P |
| from a real pro or pay for advice, picking stock | | | | 500 INDEX fund. These major index funds track |
| funds to invest in is your job. | | | | the U.S. stock market in general. You participate in |
| Don't be too casual when picking stock funds. | | | | the stock market without the fear of having |
| Stock (equity) funds are the primary growth | | | | picked a loser fund. |
| engine of the average investor's total portfolio. | | | | Check a fund's expense ratio, they all have one. |
| This is where you make the big profits, or take | | | | These expenses come out of your pocket and |
| your largest losses. Here are some investor tips | | | | eat away at your fund's value. Index funds can |
| geared to those of you not quite yet up to speed | | | | have low expense ratios, costing you less than |
| on how to invest in stock funds. | | | | one-half of 1% a year to own and hold. Some |
| Do not put much faith in investor tips that tout | | | | stock funds charge more than 2% a year. A high |
| specific funds as the "best " or "hot". Some of | | | | expense ratio is no indication of high quality. |
| this free advice is self-serving, and most of it | | | | There are numerous types or categories of stock |
| misses the mark. There are thousands of equity | | | | funds. In picking stock funds when you know little |
| funds out there, and nobody has a great track | | | | about how to invest, look first at LARGE-CAP |
| record at picking the best. | | | | funds that are general diversified funds called |
| Do not chase performance. Last year's big winner | | | | either EQUITY INCOME or GROWTH and INCOME |
| is sometimes next year's big loser. A few lucky | | | | funds. These invest in the likes of IBM, Coca Cola, |
| bets by a fund manager can later blow up in | | | | Wal-Mart, and GE. They pay average dividends |
| investors' faces as market conditions change. | | | | with average risk. |
| Focus on stock fund types or categories. Do not | | | | SMALL-CAP and GROWTH funds are riskier |
| jump from fund to fund in the same category | | | | popular categories of stock funds. Consider |
| without good reason. If a fund has a poor track | | | | smaller positions in these funds if you want |
| record vs. other similar funds, avoid it. A proven | | | | further diversification. Your major stock holding(s) |
| loser doesn't often change its ways. | | | | should be large-cap diversified funds, with an |
| If you own a fund that tends to under-perform | | | | S&P 500 Index fund being a perfect |
| other funds in its category, dump it. Mutual fund | | | | example. |
| literature will compare a fund's performance to an | | | | |