Also keep the confirmations of all of your purchases. These will be needed when you sell the fund. It also is helpful to keep a copy of the prospectus and most recent annual report in your file. Notes from conversations with your broker should also be kept. Since there are thousands of mutual funds, careful examination before purchasing and at least yearly monitoring of the fund's performance are necessary.
Mutual funds are an excellent first investment.
Remember that the stock market does go up and down and a long-term perspective is needed. Changing from one mutual fund to another is costly and not as productive as buying and holding a fund that performs well. Therefore, read the prospectuses and select a fund very carefully before investing. You need to consider your needs and your willingness to take risks. Originally published by Penn State Cooperative Extension.