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Mutual Funds
What they
are
- Professionally managed portfolios made up
of stocks, bonds, and other investments.
How they work
- Individuals buy shares, and fund
uses money to purchase stocks,
bonds, and other investments. Profits
returned to shareholders monthly,
quarterly or semi-annually in the
form of dividends.
Advantages
- Allows small investors to take
advantage of professional account
management and diversification
normally only available to large
investors.
Types of mutual
funds
- Balanced Fund includes a variety
of stocks and bonds.
- Global Bond Fund has corporate
bonds of companies from around
the world.
- Global Stock Fund has stocks
from companies in many parts of
the world.
- Growth Fund emphasizes companies
that are expected to increase in
value; also has higher risk.
- Income Fund features stock and
bonds with high dividends and interest.
- Industry Fund invests in stocks
of companies in a single industry
(such as technology, health care,
banking).
- Municipal Bond Fund features
debt instruments of state and local
governments.
- Regional Stock Fund involves
stocks of companies from one geographic
region of the world (such as Asia
or Latin America).
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