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Why Invest in Mutual Funds?
Run by Professionals
Mutual funds are run by professional money managers, who base their
transactions on extensive and ongoing research, freeing the investor from
having to make decisions he or she may not be prepared to make.
Diversification
Mutual funds provide a level of diversification that would be difficult
for most investors to achieve if they were buying and selling securities
on their own. The idea of not putting all your eggs in one basket,
diversification is a way investors can address risk. Some mutual funds
actually contain hundreds or thousands of securities and offer a variety
of investment options to help shareowners build a diversified portfolio.
Dividends and Capital Gains
Mutual fund shares can appreciate in price (capital appreciation), and
shareholders may periodically receive dividend and capital gain
distributions. Growth Potential
Some mutual funds offer outstanding growth potential. Over the long run,
many funds allow for the possibility of better returns than traditional
savings products. Convenience
Mutual funds are easy to buy and are very liquid. Fund shares can be
redeemed any day the New York Stock Exchange is open.
It’s easy to stay in control of your mutual fund
investment. Shareholders can reinvest their dividends and capital gains
at no cost. Also, investors can generally move portions of their
investment from one fund to another within the same fund family without
incurring new sales charges.
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