Benefits of Mutual Funds

Professional Money Management

• Develop investment strategy and chooses investments that best match the fund objective.
• Decision based on extensive knowledge and research of market conditions and financial performances.
• Adjust investment mix as economic conditions change.
• Diversifies portfolio to reduce risk.

Accessibility

• Easy to buy either through an investment professional or directly from an investment firm.
• Generally offered as investment selection in 401(k) plans and other employee benefit plans.
• Offer wide variety of services to meet shareholder's needs.
• Variety of investment minimums allowing participation at virtually any dollar amount.

Tax Advantages and Economic Opportunity

• Allow investors to contribute to and benefit from investment economy.
• Potentially tax deductable or tax deferred if used within certain qualified retirement plans.
• Potentially reduces taxes by reducing tacable income.

Basic Types of Mutual Funds

Long Term Funds

• Stock /Equity - funds that invest in the variety of stocks
• Index - equity funds that attemt to mirror the performance of specific index, such as the S&P 500.
• Bond - funds that invest in the variety of bonds.
• Hybrid - funds that invest in a combination of stacks, bonds and other securities

Short Term Funds

• Money Market - funds that invest in securities that generally mature in one year or less (very liquid).

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Sources from International Marketing Group