| Half of all the households in America invest | | | | Types of mutual funds |
| in mutual funds. For most people mutual fund | | | | |
| investment is better than keeping money in | | | | Each fund describes its investment objective. |
| the bank. Mutual funds are companies that | | | | Since it is predetermined you can choose |
| invest money in stocks, bonds and other | | | | whether to invest in it or not. Each All |
| securities. When you buy mutual funds your | | | | mutual funds are variations of three basic |
| money is a portion of the holdings of the | | | | classes. |
| fund. Make money in Mutual funds in a sure | | | | |
| and safer way rather than following the | | | | - Equity Funds invest in stocks |
| swings on Wall Street. | | | | |
| | | | - Fixed-income funds invest in bonds |
| Not all mutual funds have delivered and | | | | |
| putting your money in a mutual fund does not | | | | - Money Market funds are diversified |
| necessarily give you good returns. How can | | | | |
| you make money from mutual funds? | | | | Equity funds require a long term capital |
| | | | growth with some income. The best returns can |
| - Income from mutual funds is earned from | | | | be understood by the companies invested in. |
| dividends on stocks and interest on bonds. | | | | Large cap companies are the safest equity |
| | | | investments. |
| - If securities have increased in price and | | | | |
| the fund decides to sell the securities, then | | | | Bond/Income funds give you higher returns but |
| the fund has made a capital gain which it | | | | are risky if they are not invested in |
| passes on to its investors. | | | | government securities. Also another factor is |
| | | | the high inflation risk which brings down the |
| - The mutual fund holds shares and if these | | | | profit on your investment. |
| shares have increased in price. You can sell | | | | |
| your mutual fund shares for a profit. | | | | Money market funds are investments mostly in |
| | | | treasury bills. This is a safe investment |
| - You could reinvest your earning and get | | | | option. Your returns may be twice that |
| more shares as well. | | | | offered by banks, though not much your |
| | | | principal is safe. |
| - Mutual funds is a long term investment | | | | |
| option | | | | Other varieties of mutual funds are |
| | | | |
| Is Mutual Fund investment a good option? | | | | - Growth funds are the investment in the |
| | | | equity of fast growing companies. |
| Get to know mutual fund basics and invest in | | | | |
| the best mutual funds and your investment is | | | | - Specialty funds are the investment in |
| a wise one. Why are mutual funds safer than | | | | equity of companies that are of the same |
| stock market? Since the money of the fund is | | | | sector or region. |
| diversified the risk of the company is less. | | | | |
| Even though gains in some investments are | | | | - A balanced fund is a combination of fixed |
| minimized due to losses in others they still | | | | income funds and equity funds. Asset |
| stand to gain in transaction costs as it is | | | | allocation fund has objectives similar to |
| for large amounts of securities. The good | | | | that of a balanced fund. |
| about mutual funds is that you do not have to | | | | |
| follow the prices of stock and get worried | | | | - Socially responsible funds do not invest in |
| about loss. Liquidity is also there since you | | | | industries such as tobacco, alcoholic |
| can convert your shares into cash at any | | | | beverages, weapons or nuclear power. |
| time. Many banks have their own mutual funds | | | | Maintaining a healthy conscience is a |
| and a small investment of $100 on a monthly | | | | criterion of this fund. |
| basis can reap good rewards. On going yearly | | | | |
| fees and transaction fees are the costs that | | | | - Index funds replicated the performance of |
| eat into your mutual funds profits. Fees for | | | | the market index such as Dow Jones or |
| the sales persons and brokers also eat into | | | | 'Standard and Poor's 500' is a site that |
| your funds. These are called loads. There | | | | gives you info on mutual fund basics , |
| types of loads are front end loads and back | | | | mutual fund investment etc. There are many |
| end loads. So it is best to choose a fund | | | | more articles that could help you make a wise |
| with no loads. | | | | investment choice in the fund market. |
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