When we think about mutual funds, there are a lot of types to choose. Each type of mutual fund is unique in their own way and it is important to look and choose them. A fund is something that will provide a safety for the capital. The main objective of the funds is to protect the investment from not facing a loss. When you don’t want to face a loss, then any of the mutual funds will help you get rid of loss.
There are few mutual funds that will primarily aim on the growth on equities and they will increase the return on investment. Bond funds will provide to investors a very stable payment. Bond funds are good on regular payments. There are few types of funds:
- Actively managed funds
- Index funds
- Money market funds
- Bond funds
- Equity funds
- Balanced funds
- Specialty funds
Actively managed funds for the managers
Actively managed funds are usually managed by a portfolio manager who is doing all the buying and selling stuffs. It will be done on behalf of the investor ad they will try to outperform on the industry. The expense fees are very high for these funds.
Money market funds for low risk takers
Money market funds are the ones which are more structured in all the types of mutual funds. These try to attempt the bills and all papers. These have very low risk and they have very low return on investments. People who prefer no risk can make use of these funds. Investors who don’t like to take a chance can use these funds. And, they are also called as liquid investments and these can be used as emergency cash. Investors who will always have a very short term can use these funds. They have a very great stability and who are very close to old ages can make use of these funds. It is considered as one of the most popular Mutual fund investment plans.
Money market investments are normally for the small companies and all the banks. These are extremely secure and this will be as a replacement for the holding cash. When you need money, you can immediately drop cash.
Bond funds for the strong investors
Bond funds are the ones which are fixed and called as income funds. It invests as a combination of all bills and mortgages. The goal of these funds is mainly to provide regular payment and earn the possibility of all the capital gains.
Types of mutual funds for businesses
Equity funds for different types of equities and they can invest on stocks. Small-cap funds are mostly invested in stock market and they can vary for each type of investor. Mid-cap funds are those which are used by millionaires and they are normally used on businesses. Large cap funds are used as global or international funds and it is specified for certain regions only.