A Mutual Fund is a popular investment choice that pools the money from various investors to invest in the diversified assets. The associated investors also have the liberty of enjoying the professional assistance, in where the dedicated portfolio manager, takes care of the investment actions on behalf of these investors in such a way as to offer the needed benefits to them. That is why the mutual funds are still favored by the people, especially the following 5 popular varieties of them.
Fixed Income Funds
As the name implies, these funds buy such investment types that offer a fixed rate of return, such as like the government bonds and the high-yield corporate bonds. The idea is to offer a steady cash flow, which means the investors associated are conservative ones, who wish to stay from annoying risks. This mutual fund type is also suitable for retired people, as they could enjoy some fixed amount without much complications and tensions.
One of the popular choices preferred by the investors, where the associated funds concentrate on the stocks. Unlike the fixed income fund that offers, a slow, yet, steady benefit, the equity funds are capable of offering some quick results that can also be comparatively larger in value but, not without including higher risks! Again here, you have so many choices to choose from such as, growth stocks, income stocks(stocks that pay dividends), large-cap stocks, mid-cap stocks and so on.
Money Market Mutual Funds
If you are an investor, who prefers to play safe rather playing profitably then, this is the right choice of mutual fund investment for you, undoubtedly! Usually fixed income short-term securities such as the government bonds and certificates of deposit are the choices of investments, which means without having to worry about the risks you can enjoy a decent amount of benefit more than what you could gain from your regular savings account, satisfactorily!
These funds aim to replicate the performances of a specific market index and therefore, according to the value of the index the value of the mutual funds also fluctuates. The benefits of choosing this mutual fund type are lower operating costs, broader market exposure, and, less complicated.
As the name implies, when you choose these funds as your investment choice, you can enjoy a balanced mixture of output, which means without compromising your safety you can enjoy better returns. They do this by investing in the portfolio of both equities and fixed income funds, where the aggressive balanced funds hold more equities than the fixed income ones and the conservative funds, the opposite!