Types of mutual funds by mydocstocdocs9


									Types Of Mutual Funds

So, you’ve decided to jump into the mutual fund investment game. While
mutual funds have shown themselves over time to be a safer bet than regular
stock trading, there is always the chance you could lose your shirt. But the type
of fund you choose will have a lot to do with the amount of risk you take on
and the kind of return you’re looking for. For starters, mutual funds are usually
broken down into six main categories.

Equity mutual funds allow you to invest in typical shares of common, everyday

Fixed income mutual funds allow you to invest in corporate or government
securities that usually offer a set rate of return on your investment.

Balanced mutual funds allow the investor to take on a fund that includes both
stock and bond options.

Maybe the safest form of mutual funds are known as money market mutual
funds. They offer a high degree of stability for your principal, as well as high
liquidity if you need to back out.

Bond mutual funds are popular since they invest in tax free as well as taxable

And finally, sector/speciality funds are used to help diversify your holdings
within a particular industry.

Each of these types of funds can be both aggressive and risky with a high level
of reward possible, or they can be safer and lower risk. It all depends on which
fund you choose.

To break things down further, equity funds are usually divided up into four
different categories: Growth and Income mutual funds, International mutual
funds, growth mutual funds and aggressive growth mutual funds. Each
different type of fund has a particular goal in mind. For some, it’s to
aggressively pursue income, even in risky situations, while others seek to
preserve the initial investment and only take smaller chances.

As you can see, the mutual fund landscape is filled with so many options, it can
   make a newbie’s head spin. But fear not, there is almost limitless information
   available on which mutual fund is right for your particular investment strategy.
   Not only do most mutual funds and those that run them have their own
   website, there is endless advice as to which fund is right for you on the
   Internet, as well. Don’t forget to utilize publications like the Wall Street
   Journal, as well as friends and family who might have had particular luck with a
   specific fund. Welcome to mutual fund investing!
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