MUTUAL FUNDS » Best Mutual Funds

Finding a good mutual fund can be a daunting task. After all, there are several thousand actively traded mutual funds to choose from and that does not even begin to include all of the index funds and exchange traded funds (ETFs) in which a person can invest. So where does an investor, especially a new one, begin his or her search for a good mutual fund? Below are five characteristics to consider when looking for a great mutual fund:

Mutual Fund Must-Have #1: Low Expenses

Employers offering 401(k) accounts with “target date” mutual funds may soon have to abide by a newly proposed rule that would require them to provide more information to their employees. Currently, the specifics of these mutual funds, including the mix of investments used, are not disclosed. But if the proposed rule becomes official, employers will have more work ahead of them in making the funds more transparent.

What are Target Date Mutual Funds?

What is it about Harry Potter that makes preteen girls and grown men alike squeal with delight when a new book or movie is released? Maybe it’s the adventurous plots or just a really aggressive marketing plan, but I think it has a lot to do with the powerful insight Rowling’s characters share through their dialogue, both in print and onscreen.

Take Dumbledore–he’s meant to be a source of wisdom and guidance for the Hogwarts kids, yet his words often transcend the realm of wizardry and magic to be just as applicable to our reality as well. Apparently, this character has some pretty good investment advice, too.

The best mutual funds in the U.S. were highlighted by Standard & Poor’s on Monday with its first U.S. Mutual Funds Excellence Awards Program. The idea of the program was to find value in domestic funds, which are becoming less popular since many investors of mutual funds are looking overseas to make investments.

Criteria for Program

A blended fund is a mutual fund that, instead of being comprised of only one or two types of assets, has a blend of a number of different types. Many investors find that they benefit well from this investment option and try to always ensure it is included in their portfolio.

What is the Purpose of a Blended Fund?

Almost twenty years ago, Morningstar created a way for investors to quickly understand what type of mutual fund or stock they were considering buying. Most investors understand the importance of diversification across asset classes and the Morningstar Style Box allows you to easily classify stocks and spread your risk around different asset classes and investing styles.

Morningstar is the leading research company that provides independent research and analysis on over 350,000 stocks, mutual funds, commodities, futures, options and other investments to both individual and institutional investors.

The terms of mutual funds and stock market are familiar to you but at this point you aren’t 100% sure of the differences. You are interested in diversifying your investment portfolio and to try to learn a bit more about the financial options out there.

Concept of a Mutual Fund

There has been a rush of new money flowing in from mutual fund investors lately, but according to consulting firm Financial Research Corp., the flows will likely be tailing off this year.

A recent study released by the firm on Monday says if the predictions are true, big companies like Franklin Resources, Inc. and T. Rowe Price Group could have their productivity hampered because they rely on higher inflows for revenue and profits.

Through April, investors had added $187 billion to mutual funds, putting them near a record high of $347 billion; however, experts predict that the money in funds will drop to $274 billion later this year. (Reuters)

If you are looking to build a strong, diversified portfolio, you most likely purchase financial investments like stocks, bonds and mutual funds. Smart investing involves choosing investments that are secure and have the potential to earn positive returns. Some investors also believe it involves choosing funds that are socially responsible.

Do you know what types of companies your stocks and mutual funds are invested in? You may be surprised to find that your money is funding Big Tobacco or companies that contribute to Earth’s pollution. If you are concerned that your own morals may be compromised by some of the investment products you own, you should consider making socially responsible investments instead.

This is a guest post from our friend Rabbit Funds, a young business owner, marketer and financial planning evangelist, who is also a father and enjoying every minute of his life. Follow him on Twitter.

So my father and I have this ongoing debate. I keep trying to get him to invest in more mutual funds but he enjoys the thrill of buying and selling individual stocks too much. Watching the stocks tick up and down is an adrenaline rush for him.