There are so many different types of mutual funds to choose from. Find out which mutual fund types are best suited to your personal investing style.
There are many different types of mutual funds you can choose from. Some of the most popular are:
- Equity Mutual Funds
- Fixed Income Mutual Funds
- Money Market Mutual Funds
- No Load Mutual Funds
- Growth Stock Mutual Funds
- Tax Saving Mutual Funds
- Index Mutual Funds
- Gold Mutual Funds
- Socially Responsible Mutual Funds
Read on to learn the ins and outs of each of the above types of mutual funds.
Equity Mutual Funds
Most people who invest in mutual funds invest in equity funds. Ina lot of ways, these emulate the principle upon which a lot of stock-market moves are made: long-term investment resulting in capital gain
Fixed Income Mutual Funds
This type of mutual fund relies mainly on bonds — not a stock in a company but a kind of loan that the company (or a municipality, or a state, or the federal government) then pays back with interest. These are going to pay out a lot less than a successful equity type mutual fund, but the risks are controllable by bond type.
Money Market Mutual Funds
If you’re looking for a place to put your money that’s better than asavings account but very much risk-free, this type of mutual funds typically can do the trick. Most of the time you’ll find money market portfolios full of Treasury bills.
No Load Mutual Funds
A no load mutual fund is a fund in which shares are sold without a commission. The reason for this is that the shares are distributed directly by the investment company, instead of going through a secondary party.
Growth Stock Mutual Funds
A growth stock mutual fund is essentially a diversified portfolio of stocks that has, as it’s primary goal, capital appreciation. It consists mainly of companies with above-average growth in earnings. Instead of paying dividends, these companies will reinvest their earnings into expansion, acquisitions, research and development, etc.
Tax Saving Mutual Funds
A tax-free savings account can hold a variety of investment instruments – one of which is amutual fund. The fund can grow tax-free for life, meaning that interest, dividends and capital gains earned are never taxed – even when withdrawn!
Index Mutual Funds
Anindex mutualfund has a portfolio constructed to match the components of a marketindex(i.e.: S&P 500). This kind of mutualfund is said to provide broad market exposure, low operating expenses and low portfolio turnover.
Gold Mutual Funds
A gold mutual funs invests primarily in gold-producing companies or gold bullion. The price of shares within a gold fund correlates closely to the spot price of gold itself (assuming the fund holds the majority of its assets either in bullion or in the stocks/bonds of gold miners).
Socially Responsible Mutual Funds
Socially responsiblemutual fundshold securities in companies that adhere to social, moral, religious or environmental beliefs. To ensure the stocks chosen have values that coincide with the fund’s beliefs, companies undergo a careful screening process.
PRICE DROP: Get 12 months of Motley Fool stock picks and save $120. New Subscribers can try the service now for just $79.
Our Best-of-the-Best Awards for 2023
Ranking of Top Stock Newsletters Based on 2023 Picks, Dec. 31, 2023
We are paid subscribers to dozens of stock and option newsletters. We actively track every recommendation from all of these services, calculate performance, and share our results of the top performing stock newsletters for under $500 below. The main metric to look for is EXCESS RETURN--that means they are beating the market!
| Rank | Stock Newsletter | Stock Picks | Average Return | S&P500 Return | Excess Return | Percent Profitable | Max % Return | Min % Return |
|---|---|---|---|---|---|---|---|---|
| 1. | Stock Advisor | 24 | 19.9% | 13.1% | 6.7% | 83% | 107% | -28% |
| Summary: 2 picks/month offering long-term potential; Lifetime average return of 674% vs S&P500's 154% since 2002; Retail Price: $199/yr. Read our Stock Advisor Review. | Current Promotion: Save 55% with this COUPON | |||||||
| 2. | Everlasting Stocks | 24 | 18.8% | 12.7% | 6.0% | 79% | 73% | -41% |
| Summary: Only sold as part of Epic Bundle (includes Everlasting Stocks, Stock Advisor, Rule Breakers); 2 picks/month; Tom Gardner's service with the same team that has beaten the market by 3x; Retail Price: $299/yr. Read our Epic Bundle Review. | Epic Bundle ($1000+ Value): Now Just $319 | |||||||
| 3. | Alpha Picks | 24 | 17.7% | 12.6% | 5.0% | 83% | 64% | -20% |
| Summary: 2 picks/month based on Seeking Alpha's Quant Rating; Launched in July, 2022; 2022 picks are beating the market by 108%; Lifetime average return of 68% vs S&P500's 21% since 2022; Retail Price: $499/yr. Read our Alpha Picks Review. | Current Promotion: Save $50 | |||||||
| 4. | Value Investor | 12 | 17.9% | 13.0% | 4.9% | 75% | 127% | -35% |
| Summary: 10-25 stock picks per year based on Zacks' Quant Rating; Retail Price: $495/yr. Read our Zacks Review. | Current Promotion:$1, then $495/yr | |||||||
| 5. | Rule Breakers | 24 | 15.4% | 11.7% | 3.6% | 71% | 123% | -39% |
| Summary: 2 picks/month focusing on disruptive technology and business models; Lifetime average return of 266% vs S&P500's 118% since 2005; Retail Price: $299/yr. Read our Rule Breakers Review. | Current Promotion: Try it for $99/yr | |||||||
| 6. | Real Estate Investors | 12 | 14.6% | 11.9% | 2.7% | 83% | 44% | -11% |
| 7. | Cramer's Action Alerts Plus | 101 | 10.6% | 11.1% | -0.5% | 48% | 96% | -51% |
| 8. | Zacks Top 10 | 10 | 23.2% | 26.2% | -3% | 60% | 120% | -24% |
| 9. | Top Under $10 | 59 | -2.4% | 2.8% | -5.2% | 36% | 130% | -44% |
| 10. | Home Run Investor | 46 | -1.8% | 3.6% | -5.4% | 50% | 49% | -29% |
| 11. | Dogs of the Dow | 10 | 14.5% | 26.2% | -11.7% | 70% | 95% | -25% |
| 12. | IBD Top 50 Leaderboard | 50 | 13.5% | 26.2% | -12.7% | n/a | n/a | n/a |
| Top Ranking Stock Newsletters based on their 2023 stock picks' performance as compared to S&P500. S&P500's return is based on average return of SP from date each stock pick is released. NOTE: To get these results you must buy equal dollar amounts of each pick on the date the stock pick is released. Investor Business Daily Top 50 based on performance of FFTY ETF. | ||||||||
