Operating Mutual Funds – how these profit exploding money makers actually work
Although investing in mutual funds isn’t the type of subject associated with wild parties and celebrations – it is something the serious investor should consider as a way of increasing their total worth.
“But what EXACTLY is a mutual fund” I hear you ask – “how does it work, who does what and how much do they cost?”
Hang on, slow down – one question at a time please.
What exactly is a mutual fund?
Mutual funds are sold in shares to the public, allowing them to own different percentages of the fund depending on the amount they invest.
Pay more = own more. Own more = get more $$ back again (theoretically)
Stocks, bonds, money market securities and the like are purchased through the assets of these mutual funds in the financial markets. Shareholders indirectly own the assets held in the mutual fund, but the fund is guided by the investment company that finds the best way to earn the biggest return. (Indirectly owning the assets through these funds allows them to avoid the big tax...