Mutual Funds to Avoid
By James Leitz

Mutual funds are a great way for most investors to invest in stocks, bonds and the money market. Some are better than others, and some should be avoided altogether.

You should not be trying to hit a home run when you invest in funds. Rather, your objective should be to participate in the markets to get overall returns that are higher than you can make at the bank, and more consistent than you could get by playing the stock market or bond market on your own.

To give you some perspective … historically, over the long term stocks and stock funds have returned about 10% to 11% a year, bonds closer to 5% to 6%, and the safest investments (like T-bills and savings at the bank) have averaged about 3%. Over the past 50 to 80 years, inflation has averaged about 3% a year as well.

Avoid mutual funds that do not have well-established track records. Why take a chance on a fund that has not proven itself? If you want to take chances, play the market. Every mutual fund’s literature tells you when the fund was established, and shows its historical performance.

Avoid funds with erratic performance records. For example, you want your largest stock holding to be a stock fund that pretty much tracks the stock market. If the market was up 10% for the year and dividends averaged 2%, you should want to feel confident that your fund returned about 10% to 15% … rather than maybe +25% or maybe -10%.

Avoid stock funds that are “non-diversified”, unless you are investing in a sector or specialty fund that concentrates on a specific sector (like gold stocks or real estate stocks). You want the lion’s share of your stock money to be in DIVERSIFIED funds that invest in many different companies across the different industry sectors.

Avoid mutual funds with high yearly expenses and fees! Expenses are taken directly from fund assets, and work to lower investors’ returns. A mutual fund with low expenses might return 10% in a given year. An identical fund charging over 2% a year for expenses would return closer to 8%. A bond fund with high expenses could return 4% in a given year instead of 5% due to high expenses and fees.

Finally, avoid mutual funds that have sales charges whenever possible. These sales charges are called LOADS. The most popular mutual funds that have sales loads are called Class “A” funds. Here’s how they work.

You write out a check for $20,000 to invest in a stock fund with an up-front load (sales charge) of 5%. Right off the top $1000 goes to pay sales charges. Your investment is worth $19,000.

Once you really understand mutual funds and investing, you can save a lot of money by simply buying NO-LOAD funds on your own. Now you pay NO sales charges, and can invest with LOW expenses once you know the ropes.

After all, a penny saved is a penny earned.

A retired financial planner, James Leitz has an MBA (finance) and 35 years of investing experience. For 20 years he advised individual investors, working directly with them helping them to reach their financial goals.

Jim is the author of a complete investor guide, Invest Informed, designed for average investors or would-be investors of all levels of financial background and experience. To learn more about investments and investing and his new financial guide go to http://www.investinformed.com

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Best Mutual Fund - Finding Your Investment Success
By Asav Patel

There are thousands of different mutual fund combinations out there. Finding the best mutual fund, therefore, might prove to be a challenging task in your eyes. What if I told you right now that I have the answer to that question? What if I could tell you the exact best mutual fund to invest in this second? Well I can, but I guarantee the answer will surprise you.

The best mutual fund to invest in is the one that suits your needs. That’s right. There’s no magic answer, no ’secret fund’ that all the millionaires are using. The great thing about mutual funds is that they’re fully customizable, and they offer instant diversification. Having a mutual fund allows you to invest a little bit of money into a lot of things, giving you better options for success all around. If you invest $2,000 in one or two stocks, you’re taking a huge risk. While the reward might be worth it, the crash definitely will not. Invest that $2,000 in a mutual fund and you’ll have your pick of investments. What exactly is in a mutual fund? I’m glad you asked.

A mutual fund can consist of many of the following investments:

-Stocks
-Bonds
-Commodities
-Real Estate
-Currency

In addition to these things, mutual funds can also include other investments. With your $2,000, you’ll get a little slice of any of these that you want, depending on which mutual funds you consider, and how you choose to diversify your money. This might all seem like a lot to take in, and you might very well be wondering how in the world you’re supposed to keep track of all this information. You need to take in what you can on your own, and then see a financial professional to help you choose the best mutual fund and learn how to best invest your money.

Mutual funds are easy to invest in, and you can choose from two different types so that if you don’t want to pay heavy fees like you would with stock investments, you don’t have to. You can even get professional picks on the stocks in your mutual fund for FREE, when it would cost you hundreds or thousands to research before you invest in stocks alone. You’re certainly not going to prove to be 100% successful every single time, but having free professional picks certainly can’t help. If you want to learn more about mutual funds, find a financial advisor near you today.

Asav Patel,
‘My Journey To Billionaire Club’ - Blog Owner
http://www.myjourneytobillionaireclub.blogspot.com/

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Mutual Fund Investments - Investing and Making Money
By Bryan Burbank

There are many opportunities when investing in mutual funds. If you do not have a lot of time to research specific stocks then let somebody else do it for you. When you purchase this type of investment a fund manager will handle researching and investing in specific stocks for you. There are a large number of mutual funds that you can invest in so you want to do a little research to see which one fits your needs the best. Basically a mutual fund is a combination of stocks in one portfolio that is handled by a manager. The benefit is you do not have to research individual stocks yourself.

A mutual fund is a great way to invest in the stock market but let somebody else handle the research side of it for you. Before making your initial investment you want to check and see what the mutual funds investment objective is. Also it’s a good idea to see what their track record is over the past five years. Once you have found a mutual fund that you feel comfortable with you should invest with confidence that you will be making a great investment. It is important to remember that with this type of investment there are always ups and downs in the market so you have to determine if you are in it for the short-term for the long haul.

Remember that investing in mutual funds can be a very profitable way to make money. It is important that you do your research before choosing which fund you want to invest in. There are many options available to you so make sure you check out the fund’s past performance over the last five or 10 years. A mutual fund is a great way to invest in many stocks in a certain sector so that you hedge your bet and make a lot of money.

How to: Trade Mutual Funds.

You Can: Get Rich Trading.

Bryan Burbank is an expert in the field of Finances and Investing in Stocks.

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Managed Mutual Funds Vs Index Funds
By Kyle Bumpus

Those of you who have just started investing may have heard the terms “actively-managed mutual fund” and “index fund” thrown around by personal finance advice columnists, bloggers, and the financial media. This financial jargon may sound like Greek to you, and intentionally so, since the financial media needs for investing to seem difficult in order to continue selling newspapers and magazines. The truth is, investing is easy, and learning the difference between actively-managed and index mutual funds could very well be your first step towards financial prosperity.

The Two Flavors Of Mutual Funds

Mutual funds basically come in two flavors: actively managed and index. Both own a diversified portfolio of stocks or bonds and both pool the money of millions of investors around the nation into one large fund, giving investors wide diversification for a relatively small amount of money.

Actively managed mutual funds are the more glamourous of the two. Managed funds have one goal: to obtain above-average returns, often paying hot-shot managers outrageous sums of money for a shot at winning big. So what’s the problem? Unfortunately, the vast majority of actively-managed mutual funds fail to outperform the market, which is usually measured by the S&P 500 index. That doesn’t stop them from charging large fees, however. Actively-managed funds are like going to Vegas: you could win big, but you probably won’t. In most cases, you’d be better off not trying.

Index funds, by contrast, merely seek to match the market. For example, an S&P 500 index fund will merely buy the same stocks in the same proportions as the index and leave it at that. Since they don’t have to hire expensive managers, index funds are very inexpensive relatively to actively-managed funds, and generally outperform them as well due to that same cost advantage. The downside is that it is impossible to outperform the market. With index funds, you have to take your pick: would you prefer average returns with no shot of beating the market using index funds or mostly below-average returns with a shot at above-average returns using managed funds? Vanguard is the company responsible for inventing index funds and is still by far the most respected in the industry.

Visit amateurassetallocator.com for more on Vanguard index funds as well as shocking information regarding the safety of safety deposit boxes!

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Make Money by Watching the Best Mutual Fund Managers
By Jacob Lindahl

There are a whole lot of mutual funds out there, and there are quite a few that aren’t that impressive, but there are certainly a select few with amazing managers that seem to stand out year after year. Mutual funds are closely regulated and continually update shareholders on what stocks they have been purchasing and which they are selling, so it seems to me like more investors should be taking advantage of a nice free resource. By watching the portfolio of the best mutual fund managers you are able to get some great ideas for your own portfolio, and you can do it all for free.

Just about every major financial website give you a list of the top 10 or top 25 holdings of just about every mutual fund out there. Keep in mind that this information can be a few months old, so the manager may have been making quite a few moves since this list has taken place. Some critics use this argument as a reason for why you shouldn’t pay attention to mutual fund holdings.

I understand the point, but if you are investing for any kind of long-term returns knowing what stocks are consistently in a mutual fund’s top 10 can be a great tool to use. Many of the mutual fund related websites, such as Morningstar, will show you which stocks the managers have purchased more into since their last filing and which stock they have begun to trim their positions in. This information is useful because most mutual fund managers accumulate a stock over time, so it is often possible to pick up the stock as the manager is still in the accumulation phase.

What exactly makes a mutual fund manager the best? Consistent outperformance is absolutely the biggest key to being one of the best. Everyone can have a great year or two, but those who consistently are able to beat the market and their peers are the ones that you will want to follow closely. The best mutual fund managers also have a consistent strategy or theme that they use when investing, which should be apparent by looking at the moves they make in their portfolio. For example, some fund managers tend to look for companies that have fallen off the radar of most Wall Street traders, and other managers like to look for stocks that yield a high dividend.

The basis of this theory is that there so many different places that investors look for stock picks. There are stock pick message boards all over the Internet, and stock pick newsletters that charge huge amounts of money. Some of these sources may be useful, but many of them tend to fall victim to the pump and dump schemes that are so common now. On the other hand, if you are looking for information from the top mutual fund managers, why would there be any reason to doubt their motive? The mutual fund manager is trying to do his/her best to make money for investors and keep their job. A wise investor will use mutual fund portfolio holding information to help in the process of finding stocks worthy of an investment.

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