| Mutual Funds are no doubt the best root to | | | | a new manager was hired 1 year ago and the |
| enter stock market for a novice Investor but | | | | advertisement publishes a fantastic 5-year |
| some care needs to be taken while chosing a | | | | return, the other 4 years were not produced |
| mutual fund. You take some time to | | | | by that manager! |
| investigate thoroughly whether a particular | | | | |
| fund is right for you or not. Dont just | | | | It is always advised to diversify while |
| Invest in a fund getting tempted by the | | | | investing in mutual funds. Example you have |
| ratings given in magazines. They are not | | | | 10000 in any currency then invest 5000 in two |
| always authentic. There are many factors you | | | | funds. A large group of mutual funds does not |
| must see before investing in a mutual fund. | | | | necessarily provide diversification because |
| | | | the companies whose stocks they hold will |
| Always see who is the fund manager of the | | | | overlap. Use internet resources to pick up |
| mutual fund and his past track records. You | | | | high performing funds which have a good track |
| will always want to invest in a fund with a | | | | results in last five years. |
| good manager. Since you are essentially | | | | |
| turning your money over to someone to invest | | | | Also you must see whether the mutual fund |
| for you, you want to be sure that the manager | | | | does well meet your short and long term |
| of the fund has the reputation and experience | | | | financial needs. Also choose a mutual fund in |
| to invest that money well. Also, you want to | | | | which you have a good risk tolerance. Mostly |
| be sure the manager is open to answering any | | | | all kinds of investments carry risks of some |
| questions you may have along the way. The | | | | kind or the other. |
| manager may be in charge of investing in a | | | | |
| mutual fund, but you are in charge of the | | | | Always thoroughly investigate a mutual fund's |
| ultimate decision about where you want your | | | | history and be sure that it has performed in |
| money invested. | | | | a way that you'd have been comfortable with |
| | | | had your money been invested during past |
| Make sure that the actual % annual return | | | | years. |
| coincides with the fund manager's tenure. If | | | | |