Types of Mutual Funds

Types of Mutual Fund

Types of Mutual Fund

Motorcycle title pawn is one of the many different types of mutual funds or financial instruments that are available. The wide range of funds permits investors to match their investment objectives with the stated objectives of the fund. Next we briefly describe each of the major types of mutual funds. Then we discuss some guidelines for choosing the fund that’s right for you.

Growth Funds

A goal of many investors is growth in the value of their investment. Growth funds are mutual funds that emphasize capital appreciation rather than current income. Growth funds can be divided into two categories: long-term growth funds and aggressive growth funds. Long-term growth funds invest in large, mature companies that are expected to perform well without undue risk to the purchaser. Examples of long-term growth funds include Long leaf Partners, Fidelity Blue Chip Growth, and Harbor Capital Appreciation. Aggressive growth funds seek higher rewards but also accept more risk. Aggressive growth funds invest in new companies that have just “gone public,” small companies that have yet to establish a record of performance, and other, more speculative investments. The AIM Aggressive Growth Fund, Janus Mercury Fund, and Franklin Small Cap Growth Fund are examples of aggressive growth funds.

Income Funds

Income funds are mutual funds that emphasize current income rather than capital appreciation. Some investors, especially retirees who have a fixed-income and face a low marginal tax rate, prefer current income to capital appreciation. Current income from such funds can be used to supplement other sources of retirement income. Some income funds invest in government and corporate bonds. Other income funds invest in stocks with high dividend yields. Income mixed (or balanced) funds invest in government and corporate bonds as well as stocks issues, generating income from both interest payments and dividends. Some mutual funds that emphasize current income include Smith Barney Equity Income, USA Income, and Oppenheimer Equity Income.

Growth and Income Funds

Some investors desire a mix of current income with capital appreciation potential. Growth and income funds combine these objectives by purchasing common stock in companies that have a proven record of dividend payments and also have growth potential. Investors receive a steady stream of dividend income and at the same time are provided long-term capital gains incomes. Examples of funds that combine these objectives include Kent Growth and Income, Mutual Beacon, and Principal Preservation S&P 100 Plus.

Balanced Funds

Another common offering is a balanced fund. Balanced funds are mutual funds that have several objectives. These funds attempt to maintain principal, generate income, and provide long-term growth so as to avoid a motorcycle title pawn.

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