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