In your own words describe why investors purchase .

 

  • Drew 4:13 pm on August 29, 2010

    these women and finance stories helped me understand….
    mutual funds are just ready-made diversified funds that include several different stocks. if you own an individual stock, the compnay could go bankrupt. mutual funds don’t go bankrupt.

    http://www.associatedcontent.com/article/5468692/day_trading_101_for_busy_moms.html?cat=3
    two other interesting stories below i found u

  • brother_lu 4:13 pm on August 29, 2010

    it’s a safe way to make lots of money, you get a nice amount of money back with no effort, pulling in 50,000 plus a year profit with no downside

    it doesn’t have the reward stocks may have, but it doesn’t carry the risk either

  • YourBusinessManager 4:13 pm on August 29, 2010

    Mutual Funds are investments spread out over multiple stock purchases, instead of one. If one company in that portfolio tanks, it doesn’t have as much impact on the rest of his stock purchases.

    Therefore, an investor would choose a mutual fund when attempting to gain the highest interest on his money with the least amount of risks.

  • Veeda 4:13 pm on August 29, 2010

    Mutual funds are great for long term growth and less risk…perfect for the retired. Some investors are just scared of taking a roller coaster ride. They also present less risk for investors who don’t like paying comissions, who don’t like doing research and reading a prospectus, and those who don’t like reviewing their accounts every day.

  • pastanaut 4:13 pm on August 29, 2010

    A mutual fund consists of a portfolio of stocks, bonds, assets, commodities or other instruments, managed by an experienced trader, and following a prospectus which outlines the goals, risks, and objectives of the fund. When you purchase shares in a mutual fund, you are in essence buying part of a company whose assets consist of that portfolio of investments. People buy mutual funds because (if they are well managed) they generally are less risky than buying individual stocks, they require less market watching, and if they are bond funds, they can be set up to pay out dividends at a steady and predictable rate.

    The alternatives to mutual funds are usually the same debt instruments that the funds invest in. In some cases (such as commodities) they are not available to the average investor, or to buy a single share would be prohibitively expensive. In other cases (such as stocks), making a choice of a portfolio of stocks would take a lot of time and research that many investors don’t have the time or knowledge to do. Some investors, particularly retirees, choose mutual funds so that they can have a steady income without having to worry about managing their assets. They often choose bond funds which typically pay out a quarterly dividend, and have moderate to low risk of loss of principal.

    Mutual fund service companies are also managed much like banks: They offer automatic investment plans so that you can invest regularly to spread your risk out, you can make withdrawals over the phone, and you can set up trust accounts or do direct deposits. They can work with clients directly or through investment counsellors.

    I used to work for a large mutual fund company, and have purchased shares in the past. I think it is a good way to invest your money . You still need to read your prospectuses, and it’s good to get advice from an investment counsellor or registered representative, but if you are investing for the long term (which you should be), it’s a good way to go.

  • Caveat Emptor 4:13 pm on August 29, 2010

  • jeff410 4:13 pm on August 29, 2010

    Diversification. Exposure to many stocks at relatively low cost. And professional management.

  • Steve R 4:13 pm on August 29, 2010

    Easy way to invest in the stock market without doing all the homework for each stock.

  • Shashwat 4:13 pm on August 29, 2010

    well, its once choice…mutual funds are similar to shares & stocks….and is subjected to risk factor… but the best way is to choose a good plan to invest into..the best way is to visit sites like Mansukh, Sharekhan