Mutural funds are large
portfolios which sell units to investors. They are run by professional money
managers and have specific investment objectives. When shareholders invest in a
fund they are actually purchasing ownership of the fund’s portfolio and are
entitled to participate in its gains or losses.
Professionals:
Mutural funds have many benefits, such as professional management. Managing an
investment portfolio of stocks and bonds requires both time and expertise.
Mutural funds provide money management at a reasonable price. Mutural funds
managers are responsible for the overall strategic direction of their fund. The
investment manager works with traders, technical analysts and fundamental
analysts.
Diversified:
In addition to professional management, mutural funds provide diversification.
By pooling the funds of individuals, mutural funds give investors access to a
diversified portfolio that is managed by investment professionals.
Diversification is a risk management tool. A portfolio which holds many
different is less susceptible to the price moves of a single issuer. One single
security will have less of an impact on the overall performance of the total
portfolio. A diversified portfolio can lower risk and enhance returns.
Returns:
Investing requires a balance between risk and reward. Normally, in order to
achieve higher returns, an investor should be willing to accept a higher risk in
the fluctuation of the value of their investment. Lower risk investments
typically provide lower returns, but are more stabile.
Choices:
Keyinvest works together with many of the large mutural funds you can find a
couple of them here:
