1. What is a mutual fund?
Investment company that collects money from many people and invests that money in a variety of securities (investments)
A fund manager manages the money (investments) on an ongoing basis
Goal of the fund manager is to pick investments that will go up, so the fund goes up as a whole!
Give your money to an investment group, Vanguard, and it is pooled with other people’s money (contribute $100 you could only buy a few cheap stocks or one mid priced) – instead your $100 is put with thousands of people’s money – that pool of money is invested in different investments by a fund manager – can get a piece of lots of different investments

2.
Silly video

3. Mutual Funds Many different types of funds based on: Risk levels
Industries
Type of companies (large, small, medium)
Type of investments: all stock, all bond, mixed
International
Et cetera

4. What are the advantages of mutual funds?
Professional Managers
Diversification
Lower costs due to quantity (meaning you can buy a greater variety of stocks for less money)

5. What are the disadvantages of Mutual Funds?
Fees
Load fees like a sales commission
Front load, when buy: %
Back load, when sell: 0 – 6%
12B-1/Marketing Fees: 0-.75%
Management fees and expenses: %
Look at fee tables
More fees, longer should buy/hold
ETFs & Mutual Funds with no load

6. Common Types Money market funds (Safe) Bond/ Fixed Income Funds
Equity/Stock Funds (Aggressive)
Balanced Funds (stocks and bonds)
More even less volatile
International Funds
Currency risk!
Sector Funds
Healthcare, technology, finance, previous metals, etc.
Index Funds – popular
DOW JONES, S & P 500
Fund of funds
Longer term of bond more risky – more likely rates change
Equity/Stock Funds
Not dividends but capital gains – need hold at least 10 years – aggressive
Balanced Funds (stocks and bonds)
More even less volatile – often go in different directions
Green Funds
Eco friendly companies

7. How can you make money on mutual funds?
Dividends and Interest
Capital Gains: price of securities in the fund may increase. When fund sells security, there is a gain!  Distributed end of year.
Net Asset Value (NAV) – fund is not sold right away
unrealized capital gains