Ultimate guide to retirement What are the advantages of mutual funds? Investing Basics Stocks Bonds What is a mutual fund? What is a mutual fund? Who runs a mutual fund? What are the advantages of mutual funds? What types of mutual funds are there? What kinds of funds are best for retirement? What kinds of stock funds should I consider?
The biggest advantage is the instant diversification a fund can give you. Many people don't have enough money to buy a portfolio of stocks and bonds that is varied enough. Pooling your money with thousands of other investors solves that problem, ideally spreading your money across enough investments to reduce the risk of you being wiped out by any single bad bet. Another advantage is that investing in mutual funds saves time. You've essentially hired a professional investor to monitor your portfolio's holdings and do his or her best to buy and sell at appropriate times. You don't have to spend your time poring through stock Web sites and company news in order to make those decisions yourself. (Of course, if you love doing that, then investing in individual stocks and bonds may be right for you.) NEXT: What types of mutual funds are there?
What's a stock index fund? What makes an index fund so great? What's a bond fund? Bonds vs. bond funds: Which is better? What's a money-market fund? Is there a single no-brainer investment? How much do mutual funds cost? With fund expenses, how high is too high? Which is better, a load fund or a noload fund? How can I tell if a fund is a good performer? When should I sell a fund?
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