Are mutual funds actually good?

Question

I work a lot and I save a lot. I'm only 23 yrs. old and I wonder ways to make more money. I hear a lot from people that investments are good. Are mutual funds actually good? and what are some that are good to invest in?

Answer 1

Some are and some aren't. You want to find a fund who has a manager with a good long-term track record of picking winning stocks. You want to find funds that do not charge a load (up front fees) and you want the expense ratio to be as low as possible (high fees will eat into your profits). Also, if a fund is in a taxable account, you will want to watch the turnover ratio... if it is high, you will pay a lot of $ in capital gains taxes at the end of the year.

I like the Fidelity Contrafund (FCNTX) and Fidelity Leveraged Company Stock fund (FLVCX). If you're not too risk adverse, take a look at EUROX too, I've made a killing on it over the past 5 years... it's risky though, mostly Eastern European stocks.

Answer 2

You wont here it from me about mutual funds, they are a horrible investment. You can lose money and you will only be disappointed in the return you get.
Take the time to read up on mutual funds, you will find out the only ones who are making the real money are the mutual fund companies.

Answer 3

Mutual funds are great because they distribute the money among many companies. You should meet with a financial advisor at an investment corporation, especially since you are young and committed to your career and saving money. That's great! I was surprised how easy it was to meet with a financial advisor, and the charge is minimal, a tiny percentage only off interest earned. This early in your life, it would pay to really get this right because you will end up a multi-millionaire if you are starting now, seriously.

Answer 4

The question of "good" is dependent on your goals, risk tolerance & time horizon. Have I and many of my friends done nicely (for our individual requirements).... the answer is yes.

There are plenty of great funds. There are more funds that are not great and/or expensive.

You need to do two things;
A. Read at least two books on mutual funds.
B. Set up an "asset allocation plan".

If you do these two things.... you'll do much better than asking strangers, whose qualifications and motives can never be known.

SPECIAL WORD OF CAUTION: Don't pick the hot funds of the last few years because they did so well. That's how investors get burned. Know your asset allocation and the rest will fall into place.

Answer 5

Mutual funds are a very good vehicle for long term investing. There are lots of books available on the subject. "Investing For Dummies" and "Mutual Funds For Dummies" are great and easy to read.

Answer 6

A mutual fund is a form of collective investment that swimming pools money from many traders and invests the money in shares, bonds, short-term money industry gadgets, and/or different securities. [a million] In a mutual fund, the fund supervisor trades the fund's underlying securities, understanding capital helpful aspects or loss, and collects the dividend or activity income. The investment proceeds are then handed alongside to the guy traders. the cost of a share of the mutual fund, common because of the fact the internet asset value (NAV), is calculated every day based on the entire value of the fund divided by potential of the type of shares offered by potential of traders. Legally common as an "open-end business enterprise", a mutual fund is one in all 3 undemanding forms of investment companies accessible interior usa of america. [2] outdoors of the U.S., mutual fund is a regularly occurring term for dissimilar forms of collective investment. interior the united kingdom and western Europe (inclusive of offshore jurisdictions) different forms of collective investment are common inclusive of unit trusts, Open-Ended investment companies (OEICs), SICAVs and unitized insurance money.

Answer 7

Mutual funds arent great. Average return is lower then most index funds. Invest in mutual funds(Vanguard S&P 500) If you dont have a lot of time to research. Average return for the past 100 years is 10% a year.

Answer 8

mutual funds are great for people that don't have a lot of time to dedicate to researching their own stocks....
if you wanna save money up, then they're the way to go...
i'd just dump it in an Index Fund (Vanguard, Fidelity, etc.)
they aren't exciting, and they generally won't outperform the market, but you won't lose your shirt either...

Answer 9

Yes. (If you have less than $25,000.00 USD)