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Mutual Funds


A mutual fund is a company that makes investment decisions for its owners who are known as shareholders. Think of buying a mutual fund in the same way you would buy a condominium. You get the benefits of home ownership without having all of the worries and chores of owning a single home. You are part owner of the whole building when you own a condo. Similarly, when you buy shares of a mutual fund, you are part owner of 100’s of different securities with thousands of owners just like you.

Selecting the companies that are being bought and sold is the job of the managers of the fund, know as portfolio managers. So, you do not have to worry about researching the company’s financials, or making ongoing decisions whether to continue to hold them or sell them.

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Mutual funds come in many varieties. The types of stocks or bonds that the fund can buy determine its classification. Generally, funds are designed for Growth or Income, or a combination of both. You can also buy funds that invest in corporations operating in foreign nations. In fact, there are approximately 12,000 different mutual funds available. It is a good idea to research all available Mutual Fund information first before buying, or contact an Investment Advisor to help you figure out which ones are best suited for your needs.

Go to http://www.morningstar.com for the best mutual fund information available for researching mutual funds.

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