Get the Facts on Choosing the Right Mutual Fund For You

Mutual funds should seriously be considered as part of your investment portfolio if they aren't already as they allow for diversification and reduced risk. Gathering as much information is vital to becoming a successful investor. Here are the different types of mutual funds available.

Money Market Funds

These are generally categorized as having the lowest risk as these typically consist of Treasury bills and government bonds. While you shouldn't expect a huge return on your investment, money market funds are ideal for those who are conservative or want to avoid risk altogether. The good thing about these types of funds is that you can expect to get back twice what you would get from a savings account.

Balanced Funds

As you can probably guess by the name, these types of mutual funds invest into different types of assets such as stocks, bonds and other equities. These funds typically consist of 40% fixed income assets with the other 60% invested in equities. These funds are ideal for those investors who want to diversify their risk by investing into different assets while also getting a return on their investment.

Global Fund

Global funds consist of investments around the world and are generally difficult to classify them as being riskier or safer than other types of mutual funds. One thing to note is that depending on the economic climate of the country being invested in, they can be extremely volatile. However, these types of funds are excellent for countries with potential economic growth such as India or China.