Basics of Investing

Posts Tagged ‘mutual funds’

In reality, there are currently 15,211 funds available for US investors right now, and not all of them are doing as well as my 5-year old nephew could manage them with on his Nintendo. Many are losing money, in fact, and their customers won’t have the choice to get out of that poorly-slapped together fund because they purchased into their fund through their insurance company or their small investment bank, which offers very few funds to choose from. Again, only the world-class banks have access to all of the 15,211 available funds and can choose from all of them to best place your money. I would never take my business to anyone else, even if I was only investing $3,000 in a retirement fund… Why limit your Options when it can obviously do so much damage? 

Pros of Mutual Fund Investing 

All funds are put together with the intent that in case some of the assets in it perform poorly, the majority of the remaining assets will counterbalance it and the fund can still prosper. Having multiple Funds to balance against each other will also raise your safety margin as well. Best of all, funds can be started for as little as $30 in some types of accounts. 

Cons of Mutual Fund Investing 

There is still a slight risk that the chosen stocks could perform poorly or the chosen bonds (in a bond-heavy fund) could become worth less in a good stock market. Having a good Financial Advisor at a top investment bank to help in choosing these funds will greatly reduce the risk of this, and all but guarantee good, safe profit, long and short term. Still, for some aggressive investors, this is still just too slow of a method compared to stocks themselves. 

The way your present Funds, they sound great, but my experience with them is not as good. Why? 

If you have owned a mutual fund in the past and felt that it was a poor decision looking back, then you are not alone. Many people are shy of funds because they’ve lost money in them after initially being excited to buy into them. Then what invariably happens next is that either the research on that fund was not done completely, or someone who had something to gain by selling it recommended the fund… Keep in mind that a lot of brokers are in business to see you LOSE money, not gain it. (Otherwise we’d call them ‘Gainers,’ not ‘brokers,’ right? Finding a financial advisor that you can trust to have your best interest at heart is really the only important factor when it comes to things like Mutual Funds and Managed accounts… The rest is pretty simple research that all financial advisors are well-trained to do.