Many mutual funds also have a minimum investment to open an account. In many cases, the minimum up front investment will not be required if the 12 month sum of the direct deposit will exceed the minimum investment. It simply means that you invest a specified amount of money on a regular periodic basis. This strategy avoids the risk of trying to time the market and losing. Mutual funds provide an excellent method for an investor to achieve diversification without a large investment.
Time is one of the most powerful investment tools available.
Time benefits you in two ways. One way is the power of compounding interest, dividends, and gains over time. The second is that time allows you to chose a portfolio more heavily weighted in stocks. Stocks, while riskier in the short term, have historically outperformed bonds and cash in the long term. Time is your ally.