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Rule number 1: Don’t keep all your eggs in one basket.

Rule number 1: Don’t keep all your eggs in one basket.

“ENRON COLLAPSES AS SUITOR CANCELS PLANS” Enron an Energy company in the Fortune 500 in 2001 collapsed and went to zero. Seemingly without any warning.

More and more Americans are turning to a way to diversify their investments. The simplest, quickest and most efficient way is Mutual Funds. Whether clients want active management or a turn key simple solution done for them Mutual Funds are often the answer. What is a Mutual Fund?

A Mutual Fund is a professionally managed investment fund that pools money from many investors to purchase securities.

In the beginning there was only one. The first and oldest mutual fund in the United States which is still available today and first rolled out in 1924. Under the management of a Boston company.   With the first known Mutual Fund organized outside the United States in as early as 1770.

Mutual Funds are one of the primary investment vehicles in existence. They are growing fast. According to Mordor Intelligence Mutual Fund asset values stood at $17 Trillion at the end of 2018 and are expected to grow to $23.73 Trillion by 2024.
Altogether there were 9,599 funds in 2018. With domestic equity and bond funds comprising 61% of that total. #Financial Advisor Near Me

This “Pooled” investment model enables investors to purchase a diversified portfolio of financial instruments. This ‘Pool’ would steer money, depending on the funds goals, into a variety of assets.  The very first Mutual Fund in the United States was the only fund to experience the Stock Market Crash of 1929 – and even after that catastrophe it thrives to this day. Thus showing a clear test of the value of diversification in investing in stocks certainly but also the value in diversifying in stocks and bonds as well. #Mutual Funds

This is not to be confused with a Mutual Insurance Company. An insurance company owned by its policy holders is a mutual insurance company. A mutual insurance company provides insurance coverage to its members and policy holders at or near cost. Any profits from premiums and investments are distributed to its members via dividends or reduction in premiums.

Mutual funds are an excellent vehicle for investors to achieve their financial goals and when you buy shares of a mutual fund, you are pooling your money with other investors who desire diversified, professionally managed portfolios. Who are your fellow investors? Mutual fund investors are Americans of all incomes, ages and backgrounds with many different financial goals.
Mutual fund ownership is booming with about 100 million Americans or about 45% of US households invested in mutual funds. Mutual fund owners span every generation: millennials to generation X, the baby boomers. Mutual fund ownership is highest amount generation X and the baby boomers as around half of both generation X and baby boomer households own mutual funds. This makes sense because those generations are in the peak earning and saving years of their lives.

Millennial households are using mutual funds to save for the important financial goals too. 40% of their generation’s households own mutual funds. All of the savers represent a range of education levels from high school graduates to advanced degrees, and many of the savers first invested in mutual funds through their job in a workplace retirement plan such as a 401(k) or 403(b). Retirement plans at work have become the most common channels through which Americans are investing. Other ways mutual fund owners purchase funds are through brokers, independent financial advisors, discount brokerages, or directly at the mutual fund company. #David Maigret

Client Centered

Why are American mutual fund owners investing? There are many reasons, but almost all mutual fund investors are focused on long term investing, not short term trading, as a financial goal. Households at their prime earnings and savings years are more likely to identify with long term time horizons as their primary financial goal. Younger households are also saving for education expenses such as a house, or other large item. Older Households are more likely to be saving for an emergency in addition to funding their IRAs or retirements.

Americans of all different types with a variety of financial goals are mutual fund investors, and these investors are confident that mutual funds can help them reach their financial goals with nearly 9 out of 10 mutual fund owners of any household expressing their confidence in mutual funds.
Whether it is your first time investing or if you have cash building up you’d like to invest mutual funds can be a great place to start to get your money invested and diversified.

Please click below and add your name for more information and / or schedule an appointment with me at my Palo Alto office if you wish to learn more about all the options available to you.

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