Mutual funds can be described as a company that brings together a group of people with a common goal to invest in a portfolio of stocks, bonds, money markets and/or similar securities. Each investor owns shares which represent a portion of the holdings of that portfolio. The Net Asset Value (NAV), or price, of these funds is a total of the underlying assets, less all of its liabilities.
The value of your Mutual Funds can fluctuate for the following reasons:
1. The market value of the securities within the portfolio either increase or decrease
2. The fund can receive a dividend or interest payment from the securities within the portfolio
3. The liabilities (debt) of the mutual fund decrease or increase
Some Advantages of investing in a Mutual Fund include:
1. Professional Management
2. Buying Power
4. Simplicity & Convenience
As with any investment, you need to identify the suitability of mutual funds to your needs, objectives, and investment experience. Some of the disadvantages of a mutual fund may include:
1. Lack of Control of Investment Management and Trade Execution
2. Dilution. The more money a fund takes in, the more it must buy. Can they continue to find the right securities?
3. Taxes. If you hold mutual funds in a non-qualified account, you will need to pay taxes on dividends and realized capital gains.
There are a wide variety of Mutual Fund Asset Classes. Some are diversified portfolios, while others may focus on one specific goal. Some of these asset classes include:
6. Sector Specific
7. Specialty Funds
As independent financial advisors, we can offer many mutual fund families to help ensure you receive a customized solution for your investment goals. Some of the funds we use include, but are not limited to, American Funds, Fidelity, ING/Voya, Pacific Life, Calvert, Franklin Templeton, Putnam, Prudential, BlackRock and Oppenheimer.
Contact our Financial Services Team at 941-745-8300 to learn more about Mutual Funds to see if they are right for your financial situation and investment objectives.
Investors should carefully consider a fund’s investment goals, risks, sales charges and expenses before investing. The prospectus contains this and other information. Please read the prospectus carefully before investing or sending money.