Because a fund is actively managed, with bonds being added to and eliminated from the portfolio in response to market conditions and investor demand, bond funds do not have a specified maturity date. But because the market value of bonds fluctuates, as previously described, a fund's net asset value will change from day to day, reflecting the cumulative value of the bonds in the portfolio. Because the fund managers are less concerned about having to meet investor redemptions on any given day, their strategies can be more aggressive. There are numerous sources of mutual fund information available, including major personal-finance magazines and the business pages of your daily newspapers. Well-known mutual fund research firms, such as Morningstar Inc. and Lipper Analytical Services, provide detailed analyses by subscription.
Many libraries also subscribe.
In addition, rating agencies also evaluate bond funds for credit and safety. Because the annual management fees will lower returns, investors need to be aware of the total costs when calculating their overall expected returns. Money Market Funds Money market funds, as the name implies, refer to pooled investments in short-term, highly liquid securities. These securities include U.S. Treasuries, municipal bonds, certificates of deposit issued by major commercial banks and commercial paper issued by established corporations. Generally, these funds consist of securities having maturities of three months or less.