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Select the right mutual fund for your investment goals by answering a few questions first. Mutual funds help investors pool resources to invest in a portfolio of stocks, bonds, or a combination of asset classes. The three major asset classes include stocks (equity), bonds (debt) and money market instruments, such as short-term Treasury bills, certificates of deposit and commercial paper.
1. What's your risk tolerance?If taking any risk concerns you, a U.S. Treasury bond fund or high quality money market mutual fund may be right for you. If you're comfortable assuming more risk to achieve a higher return, evaluate stock mutual funds or balanced stock and bond mutual funds.
2. What are your investment goals?Your financial advisor often tells you to invest for the long term. She tells you to consider time in the market, not market timing. Long-term investors purchase quality investments. Bond investors purchase investment quality bonds. Stock investors purchase blue-chip stocks, such as the companies that make up the Dow Jones Industrial Average (INDU). Quality investments have an established track record of performance. The issuer or company's credit rating is usually high, and established by a Nationally Recognized Statistical Rating Organization (NRSRO) such as Standard & Poor's or Moody's.
3. What is your investment time horizon?Long-term investors evaluate investments over a three to five year horizon. If you're a short-term trader, mutual funds probably aren't the best investment vehicle for you. A mutual fund spreads risk over many securities. For that reason, a mutual fund of high quality bonds or blue-chip stocks tends to rise or fall more slowly than other investments.
4. How do you evaluate mutual fund costs?Even no-load mutual funds pass along costs to investors. The fund's portfolio managers, analysts, administrators and Accountants receive compensation to manage the mutual fund. Ask for a prospectus before investing in any mutual fund. Identify the expense ratio of each fund you're considering as an investment. No-load mutual funds have variable expense ratios.
What else can I help you with?
What should an investor examine in a mutual fund?
no
Difference between eqity fund and mutual fund?
Equity is the owners fund and mutual fund is pool money from the investor and invest in securities market. mutual fund has low risk an depends upon market condition.
Is there a Mutual Fund Calculator that really works?
There are several online mutual fund calculators to choose from. One of the most reliable can be found at the U.S. Securities and Exchange Commission's website (http://www.sec.gov/investor/tools/mfcc/get-started.htm).
Can a mutual fund investor use a regular account to purchase shares in an open-end fund?
No
How do you make questionnaire on consumer awareness about ulip insurance plane?
icici mutual fund
Why mutual fund investing is advantageous?
The primary advantage of investing in mutual fund is professional management, the investor purchase the fund because they do not have time to manage their portfolio, Mutual fund is relatively inexpensive way for small investors to get full time manager to make the investment
How do you select a mutual fund?
The first step is to find out the objectives of the investment. The objectives of an investment in mutual funds will be low risk or high risk, short or long term focus on liquidity, fixed income or equity. If the objectives of the investment are the same as that of the investor, then one can go on to the next step. It is very important to evaluate the past performance of the mutual fund. Through this evaluation the investor can get an idea of how the performance of the fund compares to other available options. One can also determine if the objectives that are stated have been fulfilled. This can be achieved by finding out which mutual funds have performed the best in the market. A good mutual fund should have a track record of consistently outperforming its benchmark. It is also a good idea to evaluate the performance of the mutual funds over a number of different periods of time. These could be three months, one year or three years depending on what period the investor wishes to keep his investment. The mutual funds that fall among the top five should then be shortlisted by the investor. The third step to choose a good mutual fund is diversification. An investor must diversify his funds in order to expand the amount of investment. This means that the investor should select two or more mutual funds that have similar investment objectives. This will help the investor to minimize the risks involved with his investments. Before choosing a Mutual Fund, the investor should examine the costs of the fund. These include sales loads, annual fund expenses and also management fees. There are a lot of Online trading portals that are listed with the NSE and BSE that help you to choose the right funds by providing all the necessary market information. Reliance Mutual Funds, ICICI, HDFC, Franklin Templeton are some of the best that are available. Reliance Mutual Funds provides a lot of information to investors through their knowledge centre.
What is a mutual fund Is it a safe investment?
A mutual fund is when a company takes money from many investor's and pools it together to invest in stocks, bonds and other assests. Mutual Funds can be risky because they are not insured by the FDIC.
What is a fund house?
A fund house is a company/firm that owns and operates a mutual fund. They own the fund and decide on the investment strategies to be followed with the money that was collected from the investor public for the fund.
Difference between NFO and mutual fund?
NFO is the first stage in the life of a mutual fund. A mutual fund becomes an active fund only after the New Fund Offering (NFO) is complete. An NFO is an option where people invest in the fund house for the first time. Once the fund house gets established, then there is no NFO, any investor can contact the fund house and buy the fund.
What are the main advantages of using the Washington Mutual Fund?
A Washington Mutual Fund sports advantages such as low fees, low risk, and steady growth. Though it is important to note that Mutual Funds to do not provide the investor with much flexibility.
Describe a mutual fund?
A mutual fund is an investment instrument for the common man does not have the time or expertise to invest directly in the stock market. an experienced investor pools in money from such investors and invests in the stock market on their behalf. This person is called the fund manager and the organization that employs this person is the fund house. The whole system is called a mutual fund.
