No Load Mutual Funds

Written by Michael Federico
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No load mutual funds are simply mutual funds that do not require a sales charge to be paid up-front. The amount of money a person initially puts into the fund will be invested. On the other hand, load funds will take a percentage of that original investment and use as an "entry fee."

Mutual funds offer something different for investors who do not want to practice traditional trading on the stock market. An investor in a mutual fund has his money put together with the money of all the other fund investors. The fund is essentially an investment company. With the pooled resources, a portfolio manager decides what securities or assets the fund will invest in. No load mutual funds often offer a person a long-term investment plan where ups and downs can be weathered a bit easier than when individually investing in the market.

Choosing a No Load Mutual Fund

Different mutual funds have different goals. There are funds designed specifically for people who want to take large risks. They realize there is a good chance they will lose their principal investment, but they also realize there is a chance they will turn a large profit. All funds have an element of risk involved, but some focus on more stable assets than others.

Most people enter into mutual funds that have been in existence for some time. It is possible to research a fund's past performance. This will give a potential investor an idea of its success and of the types of investments the portfolio manager is interested in making. Many funds are designed to pay off in the long run. They are not good choices for people looking to make a quick buck. These funds will often have periods of time when an investor cannot remove his money, so before a person joins the fund he has to be sure he can do without that money for an extended period.


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