Mutual Fund Termsby Debbie Vasen | More from this Blogger 24 Jul 2008 09:24 PM When investing in mutual funds, there are many terms to know and understand. However, they are not always common knowledge. To better help you evaluate your investments and understand what your financial planner is telling you, let us discuss some common terms. 1. Equity Funds - These funds invest only in stocks. 2. Fixed Income Funds - These funds invest only in bonds. 3. Growth Funds - These specialize in companies expected to grow quickly, particularly when compared to similar companies in the same industry. 4. Index Funds - The fund managers of these funds try to match the stock market average growth rate (or index). 5. Value Funds - The mix of investments in these funds are geared towards stocks that appear to be under-priced based on the company's worth or future. 6. Net Asset Value (NAV) - Since a mutual fund is actually a mix of a large amount of investments, the NAV is the value of one share of the fund. This is determined by dividing the total fund's assets by the amount of shares. 7. Expense Ratio - Funds come with expenses. The ratio is the percentage determined by dividing the total annual expenses with the average assets of the fund. Lower expense ratios are typically better. 8. Load - This is an additional charge paid by the investor when she or he purchases a mutual fund. It is purely a sales charge and many are available as no-load funds. 9. Yield - The yield in a mutual fund is the total dividends earned for a given period, divided by the share price at the end of this same period. Not all funds include dividend earning stocks, so this can be an important comparison tool. 10. Diversification - A key component to successful investing, diversifying your assets is when you invest in a variety of different vehicles. Typically the more diversified your portfolio is, the less risky it is as well. Related Articles: *How Compounded Interest Works Learn more about Debbie Vasen  Debbie Vasen is a published web content editor and writer, as well as a freelance writer for various print publications. In addition to blogging at Families. Relevantmoney tags User Comments manoj87 (5) 30 Apr 2009 10:51 AMAll these opportunities does not require you to invest anything and you can start making money from these ideas fast and free. We have discussed among other options most important tools to make money. Google adwords and paypal are the two important tools used by people all over the world for making money. ------------- smith ------------- How To Make Money-How To Make Money carrol123 (20) 20 Oct 2009 03:05 AMNice thoughts.. Shelly Smith.. -------------------------------- wow gold carrol123 (20) 20 Oct 2009 03:06 AMwow gold Community Tags investment terms, investing, mutual funds Discuss this article
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