When someone mentions investing in a fund, most people immediately think of mutual funds. The question people don’t ask is this: What type of mutual fund are you investing in? There are actually three common types: funds that invest in stocks and/or equities, funds that invest in bonds and fixed-income products, and funds that invest in a combination of these two. The table below gives you a better idea of the investment portfolios offered by each type of fund.

 

Check the prospectus

Before investing in any mutual fund, carefully consider information contained in the prospectus, including investment objectives, risks, charges and expenses. Free prospectuses may be ordered from the fund company or send a request to Credence Global Bank Invest. Many but not all prospectuses are available online. Not all mutual funds are available through Credence Global Bank Invest. Read the prospectus carefully before investing. Investment returns will fluctuate and are subject to market volatility so that an investor’s shares, when redeemed or sold, may be worth more or less than their original cost.

Stock or Equity Funds Balanced Funds (Stocks or Bonds) Bond Funds
Categorized by Objective:

  • Aggressive growth
  • Growth
  • Value
  • Blend / core (growth + value)

Categorized by size (capitalization) of companies invested in:

  • Large cap
  • Midcap
  • Small cap
  • Microcap

Other types:

  • Index
  • International (global, foreign, emerging market, single country or geographic region)
  • Nondiversified (focused)
  • Sector
  • Inverse
  • Socially responsible
  • Tax-efficient
  • Growth and income/equity-income
  • Asset allocation
  • Lifecycle/target date
  • Income replacement/distribution
  • Fund on funds
 By Issuer:

  • Government (federal)
  • Municipal (state and local government)
  • Corporate (investment grade)

By duration:

  • Short-term
  • Intermediate
  • Long-term

By focus:

  • High-yield (junk)
  • TIPS

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