different types of mutual funds
Various Types Of Mutual Funds
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A mutual fund is an investment vehicle which pools the money of many investors. There are various types of mutual funds. Each mutual fund has different risks and rewards. In general, the higher the potential return, the higher the risk of loss. The types of mutual funds vary according to the fund's investment objective.
Here in this article some of the basic types of mutual funds are described below. First and the most important type of mutual fund is Money Market mutual fund. These are highly liquid, high quality, short-term securities and which provide regular distribution of income which is determined by short-term interest rates. Money market funds are similar to treasury bills.
Investors who invest their funds for long term capital gains Growth mutual funds are good option for them. A growth fund invests primarily in the common stock of well established companies. Aggressive Growth funds is another type of mutual funds. These are highly risky investments because these funds invest in the common stock of small companies, out-of-favor companies or companies in new industries.
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Submitted by admin on Sun, 2010-05-16 07:21.