Understand the working of Mutual Funds

Half of all the households in America invest inyour money in a mutual fund does not necessarily
mutual funds. For most people mutual fundgive you good returns. How can you make
investment is better than keeping money in themoney from mutual funds?
bank. Mutual funds are companies that invest• Income from mutual funds is earned from
money in stocks, bonds and other securities.dividends on stocks and interest on bonds.
When you buy mutual funds your money is a• If securities have increased in price and the
portion of the holdings of the fund. Make moneyfund decides to sell the securities, then the fund
in Mutual funds in a sure and safer way ratherhas made a capital gain which it passes on to its
than following the swings on Wall Street.investors.
Not all mutual funds have delivered and putting