The best mutual funds have been good investments since the 1970s and many will remain so beyond the year 2011.
The secret to finding the best funds is to get a handle on the best fund companies: ones that offer good investments from the INVESTOR'S point of view.
Mutual funds haven't changed all that much in the past 40 years.
In 2011 and beyond some will still be good investments, and there will still be 4 basic types to choose from: money market, bond, stock and hybrid types that represent a combination of the other three.
The difference between then and now: more fund companies competing with a confusing number of alternatives and cost structures.
What hasn't changed is that all fund companies make money when you invest with them.
Some just make more than others.
From the investor's point of view the best funds have a low cost of investing.
In terms of performance, you can't pick the best funds in any of the 4 categories year in and year out.
None of the fund companies stand head and shoulders above the rest as money managers.
But you can find good investments by cutting costs; and this directly improves your bottom line - and profits.
Avoid loads, which are sales charges and can amount to 5.
75% off the top for stock funds.
For a $10,000 investment $575 can go to pay for the cost of selling the investment.
Such funds may be good investments from the salesman's point of view, but not so if you are the investor.
The good news is that some of the biggest and best fund companies for 2011 and going forward got that way by offering good service and funds directly to the public at low cost.
These fund companies offer NO-LOAD funds, which means that there are NO sales charges.
You invest $10,000 or any amount and all of your money goes to work for you.
Vanguard, Fidelity, T Rowe Price and American Century have been offering the public low-cost good investments for many years.
In your search for the best funds at low cost you will also want to look for those with low EXPENSE RATIOS, because ALL FUNDS charge your account for expenses year in and year out.
If the expense ratio is 2.
00, for example, a fund will take $200 from an investment worth $10,000 for yearly expenses.
High expenses might represent good investments for salesmen or fund companies...
but certainly not from your point of view as the investor.
Simply put, mutual funds are good investments for most people because they manage a diversified portfolio of securities for their investors.
Few folks have the time or ability to do this themselves.
But why pay big bucks for their services when you can find some very good funds with some of the best fund companies in the business? Now let's zero in on these low-cost funds.
First, we're looking for funds with NO upfront sales charges or loads.
You can find them by searching the internet for "no-load funds".
Second, we want a low expense ratio...
the lower the better.
Data for every fund shows sales charges and expenses, this info is not a secret; it is just overlooked by the average investor.
Third, to qualify as good investments, stock and bond funds need to perform in line with their benchmark.
If you can find fund companies that have funds that meet all three of our criteria, you've found some good investment options for 2011 and the future.
The good news here is that these good investments can be found in the short list of fund companies I gave you earlier in the form of INDEX FUNDS.
They are low cost because they have no sales loads and low yearly management expenses...
because they simply invest to track their appropriate index...
which IS their benchmark.
This same index or benchmark is used as the standard for all similar funds with similar objectives.
The difference is that other funds with a high cost of investing often under perform this same benchmark.
Looking at 2011 and into the future, average investors can put the numbers in their favor by simply investing in good investments offered by some of the best fund companies in America: no-load index funds.
The secret to finding the best funds is to get a handle on the best fund companies: ones that offer good investments from the INVESTOR'S point of view.
Mutual funds haven't changed all that much in the past 40 years.
In 2011 and beyond some will still be good investments, and there will still be 4 basic types to choose from: money market, bond, stock and hybrid types that represent a combination of the other three.
The difference between then and now: more fund companies competing with a confusing number of alternatives and cost structures.
What hasn't changed is that all fund companies make money when you invest with them.
Some just make more than others.
From the investor's point of view the best funds have a low cost of investing.
In terms of performance, you can't pick the best funds in any of the 4 categories year in and year out.
None of the fund companies stand head and shoulders above the rest as money managers.
But you can find good investments by cutting costs; and this directly improves your bottom line - and profits.
Avoid loads, which are sales charges and can amount to 5.
75% off the top for stock funds.
For a $10,000 investment $575 can go to pay for the cost of selling the investment.
Such funds may be good investments from the salesman's point of view, but not so if you are the investor.
The good news is that some of the biggest and best fund companies for 2011 and going forward got that way by offering good service and funds directly to the public at low cost.
These fund companies offer NO-LOAD funds, which means that there are NO sales charges.
You invest $10,000 or any amount and all of your money goes to work for you.
Vanguard, Fidelity, T Rowe Price and American Century have been offering the public low-cost good investments for many years.
In your search for the best funds at low cost you will also want to look for those with low EXPENSE RATIOS, because ALL FUNDS charge your account for expenses year in and year out.
If the expense ratio is 2.
00, for example, a fund will take $200 from an investment worth $10,000 for yearly expenses.
High expenses might represent good investments for salesmen or fund companies...
but certainly not from your point of view as the investor.
Simply put, mutual funds are good investments for most people because they manage a diversified portfolio of securities for their investors.
Few folks have the time or ability to do this themselves.
But why pay big bucks for their services when you can find some very good funds with some of the best fund companies in the business? Now let's zero in on these low-cost funds.
First, we're looking for funds with NO upfront sales charges or loads.
You can find them by searching the internet for "no-load funds".
Second, we want a low expense ratio...
the lower the better.
Data for every fund shows sales charges and expenses, this info is not a secret; it is just overlooked by the average investor.
Third, to qualify as good investments, stock and bond funds need to perform in line with their benchmark.
If you can find fund companies that have funds that meet all three of our criteria, you've found some good investment options for 2011 and the future.
The good news here is that these good investments can be found in the short list of fund companies I gave you earlier in the form of INDEX FUNDS.
They are low cost because they have no sales loads and low yearly management expenses...
because they simply invest to track their appropriate index...
which IS their benchmark.
This same index or benchmark is used as the standard for all similar funds with similar objectives.
The difference is that other funds with a high cost of investing often under perform this same benchmark.
Looking at 2011 and into the future, average investors can put the numbers in their favor by simply investing in good investments offered by some of the best fund companies in America: no-load index funds.