Changes

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.

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 stock.

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

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

* 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.

* 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.

* 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 ones.

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

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

* 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.

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.