Beware of dazzling performance claims. ALL mutual funds have costs that lower your investment returns. Others are sold mainly through brokers, banks, financial planners, or insurance agents. If you buy through these financial professionals, you generally will pay an extra sales charge for the benefit of their advice. Compare a mutual fund with others of the same type before you buy.
Mutual funds can be a good way for people to invest in stocks, bonds, and other securities.
Mutual funds are managed by professional money managers. By owning shares in a mutual fund instead of buying individual stocks or bonds directly, your investment risk is spread out. Because your mutual fund buys and sells large amounts of securities at a time, its costs are often lower than what you would pay on your own. There are sources of information that you should consult before you invest in mutual funds. The most important of these is the prospectus of any fund you are considering.