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A mutual fund pools the money of many investors to purchase securities. The fund’s manager buys securities to pursue a stated investment strategy. By investing in the fund, you’ll own a piece of the total portfolio of securities, which could be anywhere from a few dozen to hundreds of stocks. This provides you with a convenient way to obtain instant diversification that would be harder to achieve on your own. Types of mutual funds There are many mutual funds to…
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Bonds may not be as glamorous as stocks or commodities, but they are a significant component of most investment portfolios. Bonds are traded in huge volumes every day, but their full usefulness is often underappreciated and underestimated. Why invest in bonds? Bonds can help diversify your investment portfolio. Interest payments from bonds can act as a hedge against the relative volatility of stocks, real estate, or precious metals. Those interest payments also can provide you with a steady stream of…
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Below are summaries of some basic principles you should understand when evaluating an investment opportunity or making an investment decision. Rest assured, this is not rocket science. In fact, you’ll see that the most important foundation on which to base your investment education is simply good common sense. Don’t be intimidated by jargon. Don’t worry if you can’t understand the experts in the financial media right away. Much of what they say is jargon and is actually less complicated than…
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