The benefits of investing in mutual funds are automatic diversification, professional management and daily liquidity. Mutual funds, by definition, generally invest their assets in many different securities. This can cushion the negative impact of any one stock or bond in a fund and automatically diversifies an individual's portfolio. Because mutual funds are professionally managed, they are practical for individuals who don't have the time or the expertise to allocate their own assets. Plus investors have the ability to convert their investments to cash at the next current market value.
Mutual funds vary significantly based on objective and investment style.
Montgomery has a wide array of funds designed to meet differing investment goals. Large companies generally have a greater capitalization, because more money is invested in them. Small-cap stocks also offer the potential for greater returns. Every choice concerning the way an investor saves and invests money involves some degree of risk. As a result, an investor's financial health depends on his or her understanding of what the risks are and how to balance them against the potential rewards.