Understand Aggressive Growth Funds

The stock market and its lingo can be confusing sometimes, but it is important to know about the economy. Here is a brief tutorial on what aggressive growth funds are and what they mean for you!

Know that an aggressive growth fund is a specific type of mutual fund. Its main goal is to achieve the largest capital gains possible. Due to this, it is not as diverse as other funds that you may choose from.

Understand that aggressive growth funds are most accommodating for investors who are willing to take the higher risk to produce a bigger return on profit, but still want the safety net of a fund rather then an individual stock.

Realize that these types of growth funds are also beneficial for those who want a closer balance between mutual fund returns and stocks. However, as mentioned before, these types of mutual funds are not risk averse compared to something like an index fund.

Know that aggressive growth funds tend to produce fantastic results in good economic times, and horrible results during bad economic times like a recession.

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Buy an Index Fund

Investing in an index fund is a great way to diversify. But it is very important that you buy the correct index fund for your needs. This article tells you how.

An Index Fund is a type of investment that seeks to duplicate the movements of an index of a specific financial market, like the S&P 500. Owning an index fund is a great way to diversify. You can create your own personal "index fund" by investing is hundreds of different stocks, but this proves to be very costly and quite time consuming. Therefore, investing in an actual index fund provides you with the return of the index that it's tracking with low fees and low time management.

Since there are many different types of indexes, there are many different index funds. The following is a list of indexes, and the ticker symbols of the best index funds that track them: S&P 500 (most common) - SPY, VFINX, SWPPX, FSMKX S&P 400 (mid-size companies) - SPMIX, VIMSX S&P 600 (small-size companies) - SMCIX NASDAQ 100 (largest NASDAQ companies) - RYOCX Russell 2000 (small companies) - NAESX Wilshire 5000 (almost all U.S. stocks) - VTSMX, FSTMX

The United States economy has been going through some tough times lately. All of these indexes are down sharply from their all-time highs reached in 2007. If you have some extra money to use for investing, but not much time, I would highly recommend slowly buying some shares of an index fund.

As far as deciding which index fund is for you - that depends on how okay you are with risk, and how soon you might need your money. In general, smaller companies are more riskier than larger companies. So invest accordingly. But remember - the greater the risk, the higher the potential return. Good luck and please feel free to ask questions!

How to Buy a Mutual Fund

Understanding how to buy a mutual fund is essential for a relaxing retirement. This article teaches how to invest in mutual funds.

A mutual fund is a professionally and actively managed investment tool that pools money from many investors and invests it in stocks, bonds, and various other securities. It can have a broadly diverse portfolio or a narrowly focused portfolio. A mutual fund may be extremely high risk or very safe. Some pay dividends, some have transaction fees, and some require minimum investments. How do you decide which mutual fund is the best one for you to invest in...?

The first thing you need to do is assess your risk tolerance. Generally, the greater the risk = the greater the potential profit (or loss). Your risk will largely depend on your time frame. Buying a mutual fund when you're 30 years old is a lot different than when you're 60. The closer you are to retirement, the less risk you should be exposed to.

There are many different companies that offer mutual fund investing. Vanguard, Fidelity, eTrade, Schwab, and Ameritrade are some of the best. I will provide the names and ticker symbols of some leading mutual funds to consider for your investment. Please do your research and risk assessment before purchasing any mutual fund. The number to the right of the fund name represents the level of risk associated with the fund (5 is the highest risk): CGM Focus Fund (CGMFX) - 5 Fidelity Fifty (FFTYX) - 4 Fidelity Dividend Growth (FDGFX) - 3 Allianz Dividend Value (PEIDX) - 1 Third Avenue Small Cap (TASCX) - 5 Janus Enterprise (JAENX) - 3 Again, these are just for your consideration. I do consider them to be some of the best in the industry. Good luck and please feel free to ask questions!

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How to Research Oppenheimer Mutual Funds

In the early 1950s, Oppenheimer & Co. was initially established as a brokerage firm, but in 1960, the Oppenheimer Management Corporation (now called OppenheimerFunds, Inc.) was created in order to more effectively manage the Oppenheimer Fund. In the 1990s, OppenheimerFunds began extending its focus from retail mutual funds to offer more investment products and services. It now claims over $200 billion in assets, many of which are bond funds.

Research Oppenheimer Mutual Funds

Use the award-winning Oppenheimer website to track fund performance (see Resources below). Oppenheimerfunds.com received a rating of "Excellent" from the DALBAR WebMonitor in the first quarter of 2007 for its innovative and functional approach to providing financial services online.

Research one of Oppenheimer's top-rated municipal bond funds, the Oppenheimer CA Municipal fund (OPCAX), which is managed by Ronald H. Fielding and got its start in 1988. Over a billion dollars in assets are invested in various CA bond funds in order to achieve a high level of tax-exempt interest income.

Check out the Morningstar rating for the Oppenheimer CA Municipal fund, which is 5 stars. This high rating is due in part to the average annual returns of the last few years: 7.71 percent in 2006, 10.94 percent in 2005 and 8.40 percent in 2004. A negative annual return was posted in 1999.

Prepare to spend at least $1,000 for your initial investment in this fund. Subsequent investments require a minimum of $50.

Research another one of the bigger and more successful Oppenheimer mutual funds, the Oppenheimer NJ Municipal fund (ONJAX), which was created in 1994. Like the Oppenheimer CA Municipal fund, the Oppenheimer NJ Municipal fund invests the majority of its half billion in assets in New Jersey municipal securities, and it also aims to make its investors money through tax-exempt interest income. It is also managed by Ronald H. Fielding.

Review the impressive 5-star Morningstar rating for the Oppenheimer NJ Municipal fund, as well as its annual returns in the past. The annual return was 7.76 percent in 2006, 10.10 percent in 2005 and 8.53 percent in 2004. The last time the fund posted a negative annual return was in 1999.

Pull together at least $1,000, which is the minimum for the initial investment in the Oppenheimer NJ Municipal fund. Prepare to spend at least $50 on subsequent investments.

Look into one of the other mutual funds provided by Oppenheimer. There are about 70 mutual funds available through this company, many of which focus on domestic and international stocks in addition to municipal and taxable bonds.

Tips & Warnings

• If investing in municipal bonds mutual funds, it is important to realize that the tax exemption only applies to the interest-generated income. You will be expected to pay taxes on any capital gains you earn by selling your shares at a higher price than you paid to purchase them. You will want to factor this into your research.

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How to Research Fidelity Mutual Funds

Fidelity is one of the best-known and most prolific of the big-name mutual funds. The Johnson family mostly controls this privately owned company, and it is often associated with the infamous Peter Lynch, who took the company's once little-known Magellan fund from $18 million in assets to $14 billion in assets over a 13-year period starting in 1977.

Research Fidelity Mutual Funds

Appreciate Fidelity's innovative approach to fund management: the company is responsible for several "firsts" in the world of investing. For instance, Fidelity was the first to allow investors the option of purchasing funds through an 800 number, and it was also the first to provide many industry- or sector-specific mutual funds to its investors.

Research the company's Contrafund (FCNTX), its largest and top-rated fund. Managed by William Danoff, this is a large-growth fund begun in 1967, and it targets capital appreciation by investing mostly in growth and value stocks from U.S. based issuers, although stocks from foreign issuers may also be included in the portfolio. It also seeks to invest in the securities of companies that it believes are not valued properly in relation to their industry-specific competition.

Look at the numbers for the Fidelity Contrafund. It has a 5-star rating from Morningstar due in part to its average annual returns: the annual return was 11.54 percent in 2006, 16.23 percent in 2005 and 15.07 percent in 2004. The last negative annual return was posted in 2002.

Prepare to spend a minimum of $2,500 for your initial investment in the Contrafund and a minimum of $250 for each subsequent investment.

Research the company's Magellan fund (FMAGX), its second-largest mutual fund. Begun in 1963, this large-growth fund is currently managed by Harry W. Lange, and like the Contrafund, it aims for capital appreciation by investing in growth and value stocks from domestic and foreign companies. The fund's "go everywhere" approach means there is no specific strategy other than improving performance.

Check out the performance of the Fidelity Magellan fund. Morningstar has given this fund a 5-star rating, and the total annual return was 7.22 percent in 2006, 6.42 percent in 2005 and 7.49 percent in 2004. That said, the fund posted a negative annual return of 23.66 percent in 2002.

Collect at least $2,500 for your initial investment in the Magellan fund. The minimum for subsequent investments is $250.

Research one of the many other mutual funds from Fidelity. There are over 300 to choose from, and their assets include domestic stocks, international stocks, municipal bonds and taxable bonds.

Tips & Warnings

• Before you research Fidelity mutual funds, realize that investing always carries risk as the FDIC does not guarantee or insure mutual funds.

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How to Receive Mutual Funds Newsletters

Once you've decided to invest in mutual funds, it's a good idea to continue your education and keep up-to-date on all the latest information. One good way to keep up with the latest trends is by subscribing to one or more mutual funds newsletters. You can receive newsletters from your own mutual fund, which may have monthly or quarterly newsletters, or you can sign up for one of many independent ones and receive them in your e-mail box. Mutual funds newsletters can be a great help for investors, but you should be careful when choosing to follow any newsletter's advice.

Receive Mutual Funds Newsletters Online or by Mail

Take advantage of the wealth of information provided in mutual funds newsletters. Not only do they show the benefits of investing, but they also provide strategies, tips and insights to improve your portfolio.

Check out the links to the newsletters recommended by your friends or financial advisor.

Read through sample newsletters to find one with a style that works for you.

Consider subscribing to the Hulbert Financial Digest to find the highest-rated mutual funds newsletters available.

Choose your method of subscription. Options usually include online delivery or regular mail delivery.

Go online and visit your favorite investment sites and take note of the newsletters these sites offer or recommend.

Tips & Warnings

• Although many mutual funds newsletters are free, you may want to receive the Hulbert Financial Digest, a premium newsletter. It is an independent newsletter that rates other mutual funds newsletters. Many newsletters refer to the Hulbert Financial Digest.
• Choose newsletters associated with informational websites you already like and visit, or try out ones suggested by friends or your financial advisor.
• Stay with established newsletters and avoid any untried ones.
• Even though newsletters provide guidance and tips, it is always prudent to read a mutual fund's prospectus before actually investing.
• Make sure that any newsletter you subscribe to is a Registered Investment Advisor.
• Avoid newsletters attached to a mutual fund company or other investment service other than your own.
• Keep in mind that some newsletters are trying to sell specific mutual funds. Always check their source.
• Know that many newsletter publishers often take advantage of their first amendment rights and occasionally misstate mutual fund returns.
• Not all newsletters are free and some will require a credit card to maintain a subscription.

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How to Read Mutual Funds Symbols

Mutual fund symbols can look pretty strange, but once you learn how to read them they make a lot of sense. Mutual funds, like stocks, use ticker symbols as abbreviations for the fund's name. Different types of investments have different ticker symbols. Mutual fund symbols are 5 letters long and end in X. Symbols after the fund's name tell you more information about the type of fund it is.

Understand Mutual Fund Symbols

Open your newspaper or go to your online resource and read about the mutual fund in which you are interested. These are generally listed alphabetically to help you find them easier.

Know that the fund's name or ticker symbol appears on the left side, with information about it appearing in columns to the right.

Look for 'NAV'. This is the Net Asset Value of the fund. It tells you how much money each fund share is worth.

Search for the term 'offer price' or 'buy price'. This is how much you have to pay for a share of the fund, including any sales fees. If the offer price says 'NL,' it means the fund is a no-load fund and you would pay the same price to buy it as you would if you were to sell it.

Read the final column. This should tell you the amount of the fund's appreciation the previous day. A plus symbol (+) means the fund has gained money, while a minus symbol (-) shows how much it has lost.

Check the fund's ticker symbol. Letters after the name have different meanings. An 'r' means the fund has a back-end load, or a fee you pay when you redeem or sell your shares. A 'p' designates a fund with a 12B-1 fee. A 't' means there is a 12B-1 fee and a deferred sales charge. An 'f' means the most recent numbers for the fund are not available.

Tips & Warnings

• Mutual fund symbols always have 5 letters and end in X. If you are only interested in investing in mutual funds, you can ignore any shorter symbols.
• Pay close attention to the symbols after the fund's name, as these let you know what types of loads or fees you can expect with that fund.

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Rank Fidelity Mutual Funds

Fidelity is a brokerage firm based out of New York. Fidelity deals with mutual funds, trading and active trading, annuities and 401(k) retirement rollovers. Fidelity is a large and well-known company with active managers for their mutual funds. Fidelity manages over 150 mutual funds. If you choose to use a brokerage firm like Fidelity, you need to know how to rank their mutual funds compared with others. There are several Web sites that will tell you how to rank Fidelity mutual funds according to their own criteria, but you should examine your own needs and base your decision on those.

Find Fidelity Mutual Fund Rankings

Visit an online ranking site like Morningstar or Lipper.

Find the ticker abbreviation or the name of the mutual fund in which you are interested.

Go to the Morningstar or Lipper Web site and click on 'funds'. Alternatively, use the search feature to find the mutual fund you want.

Look for the mutual fund you want within its family. In this particular case, Fidelity.

Select the mutual fund you're interested in and read across on the same line to find the rating.

Create Your Own Ranking for Fidelity Mutual Funds

Make a list of reasons you're investing and goals you hope to achieve. Arrange them from most important to least important.

Search the Fidelity Web site for mutual funds that match your list. You can also search Fidelity for different types of mutual funds and tips on getting started.

Tips & Warnings

• Morningstar uses a five-star system to rate mutual funds, with 5 stars being the highest rating and 1 the lowest. The mutual funds are all risk-adjusted, which means they account for the risk involved in investing in the fund.
• Lipper uses an alphabetic system to rate mutual funds, with A being the highest rating down to E, the lowest.
• Keep your tax advisor in the loop. Investing in mutual funds can have significant tax consequences. Make sure your tax planner knows about the investments you plan to make.
• Remember that past rank performance is not an indicator of future returns. Your mutual fund may have done well in the past only to tank in the future. All ratings can do is let you know how well the funds have done in the past.

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How to Profitably Invest in Mutual Funds

There are ways that conservative or aggressive investors can invest with ease and diversity. If you are planning for your retirement, a child's college, or for a vacation, here are tips to help you understand mutual funds.

If you are charting a financial plan for your retirement, a child’s college expenses, or merely a vacation in the Caribbean, there are ways to let your money work for you. Whether you choose the goal of aggressive growth or conservative income, let the pros help you. And since you should not put all your eggs in one basket, diversification is essential.

The answer is a mutual fund. A mutual fund is a diversified portfolio of stocks, bonds, and/or short-term money market instruments, managed by seasoned professionals. They are sold by shares, usually with a commission, and can be purchased through a stockbroker or directly through a mutual fund.

There are different types of mutual funds to buy depending on your investment objective. Some funds are designed for aggressive growth by buying and selling stocks of small companies just starting up, turnaround companies, and companies possibly targeted for buyouts. These may be risky stocks to buy on your own.

Some mutual funds are conservative, purchasing highly rated, blue chip, large capitalization stocks. Many of these companies have been around a long time, some even paying dividends. These corporations often provide essential goods, such as oil or food.

Others are specialized funds, such as those buying technological companies, environmentally-friendly stocks, or foreign firms. Still other mutual funds track popular stock indexes, such as the Dow Jones Industrial Average or the Standard & Poor 500 index.

Some investors prefer income mutual funds. These funds offer a portfolio of stocks, such as utilities, which pay a high dividend yield. Other funds offer a mix of corporate and/or government bonds with a sprinkling of short-term money market instruments yielding interest. There are even some mutual funds which combine utility stocks and bonds.

If you have a good broker who you trust, ask him for information about the type of mutual fund which would meet your investment objective. If you don’t, you may contact various mutual fund companies by phone or e-mail. Request a mutual fund prospectus for more details about the fund. A prospectus will tell you about the fund’s money managers, fees, financial highlights, historical performance, risks, longevity, and reputation.

Mutual funds are good investments for retirement plans, such as 401-Ks and IRAs. Most mutual fund families have various types of funds to offer the investor, like growth, income, foreign, tech, blue chip, money markets, and so forth. Once in the family, the investor may move between the various funds, depending on the objective. Plus, shares may be sold, if needed. Mutual fund prices are quoted every week day in major newspapers.

Mutual funds may be the ideal way for an investor to meet his objectives, whether it be growth, income, or liquidity. Although past performance is no guarantee of the future, there are many long-established, well-run funds which may meet your needs.

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Pay Less Taxes on Mutual Funds

The only thing worse than paying capital gains on bullish mutual funds at the end of the year—is paying them on bearish ones. This article shows you how you can lower your tax bill next year.

Virtually all stock mutual funds pass along a proportionate share of their annual capital gains distributions to their investors each year. This happens regardless of whether the fund actually made money or not; every fund has appreciated positions that are liquidated during the year, and the gains from these profits must be reported to the shareholders.

Tax-managed funds are mutual funds that are managed so as to minimize declarable gains within the portfolio and include strategies such as harvesting losses on stocks to be carried forward for seven years. They also sell specific groups of shares with the highest cost basis and use them to offset other appreciated stock lots. These funds often have little or no capital gains distributions at the end of the year. An example of this type of fund is the Eaton Vance Tax-Managed Growth Fund.

Another tax-efficient alternative is an index fund. These funds are not actively managed either, and not only provide the growth of broader market, but do so without the annual gains generated from the buying and selling of the portfolio managers.

Finally, a third alternative for long-term investors is UITs. These investments are similar to mutual funds, except that they simply buy and hold a set portfolio of securities for a set period of time. Although gains will be realized when the trust matures, there are no declarable gains for the duration of the trust, which can last for up to five years in some cases.

Tips & Warnings

• This article is intended to be purely educational and should not be construed as tax advice. For more information, consult your investment or tax advisor.

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Passive or Active Management

Stock mutual fund investors have the choice of investing in either passive or active funds. What is the difference and why does it matter?

WHAT ARE ACTIVE FUNDS? Actively traded mutual funds are probably the oldest and most common form of mutual fund. Actively traded funds have a fund manager who oversees the selection of stocks which will be in the fund in an effort to meet his stated objective.

Step2

WHAT ARE PASSIVE FUNDS? Passive funds are more or less on autopilot. They are funds comprised of a pre-determined basket of stocks, usually mimicking a particular stock index like the S&P 500, Dow Jones Industrials, or Russell 2000. Passive funds are commonly referred to as "index funds". The passive fund therefore normally has very little "turnover" or changes in the individual stocks within the fund. A sale or purchase may happen when a company is added to or subtracted from the index.

Step3

FEES - Because passive funds are based on an index and are basically on auto-pilot, it takes very little oversight to keep them running according to their objective. Consequently passive fund investors enjoy lower costs in their funds relative to active managers. You can easily find passive S&P500 index funds, for example, that charge as low as %0.10 per year. Not bad! On the other end, active fund managers have significnatly higher administrative costs, including for example salaries for the fund managers, equity analysts, office managers, marketing managers, etc. Consequently it is common to find that these funds charge an "expense ratio" in the neighborhood of 1.0%-%1.7%. Obviously, lower is better all things being equal. Of course if the manager has a proven strong track record, some people will argue that he deserves his higher fee... but passive index investors don't agree.

Step4

PERFORMANCE - The bottom line! It is commonly said that 70% of all active managers fail to outperform their benchmark index after fees. That's pretty amazing when you consider how much money is invested in active managers! Anyhow, for this reason index funds have become increasing popular as investors can outperform 70% of active managers primarily because of the lower cost. Why do people continue to invest in active funds? Some people find investing in indexes just too boring! And they also believe they can identify the 30% of managers who do beat the index. Beyond that, they also believe that if they fail at finding a winning manager, the downside probably won't be so bad, whereas the upside could be great! The irony behind the situation is that passive investors couldn't exist if it wasn't for all the active managers out there who make the market efficient and rational. If everyone invested in passive funds, the market would become irrational and active managers could find ways to beat the index! But you don't have to worry about that - there will always be enough active investors to keep the passive investors smiling and winning 70% of the time!

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Manage Stock Mutual Funds

If you're looking for fast growth, stock mutual funds are an attractive option. Historically, stocks have performed better than bonds and cash over the long term. But that doesn't mean they're without risk. Investing in stock mutual funds usually requires a lot of buying and selling. The best way to make sure your investment is properly managed is by finding a qualified financial advisor to help you along the way.

Understand Stock Mutual Funds

Learn about stock mutual funds. These types of funds invest strictly in stocks, as the name implies. Stock mutual funds are also known as equity funds.

Discover your options. There are many different types of stock mutual funds for you to choose from. Some of the more popular types include growth, blend, sector and aggressive growth funds.

Choose a Financial Advisor

Admit when you need help. Investing is a risky venture. Inexperienced investors find that consulting with a financial advisor helps them make conscientious, well-rounded decisions.

Consider your financial goals ahead of time. Having a general idea of how you want to invest your money will point you in the right direction when choosing a financial advisor. At the very least, you'll know if you need to consult with a specialist.

Research your advisor. It's a good idea to call your state's licensing boards to make sure you're not being presented with fraudulent credentials.

Prepare a list of questions before your interview. You'll want to cover the specifics, like payment and experience. It's also helpful to come up with a hypothetical scenario to see how your potential advisor would manage the situation.

Tips & Warnings

• Keep in mind that choosing a financial advisor may take some time. You shouldn't rush the process or hire the first person you interview if you're not entirely comfortable with the situation.
• Walk away from any financial advisor who pressures you to invest in funds you're not at ease with. If your advisor is pressuring you to buy, he or she is probably not the best person to manage your portfolio.

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Manage Class B Mutual Funds

Class B shares are the second most preferred type of class stock. Occasionally, Class B shareholders are given more voting power than their Class A counterparts. In addition, Class B shares do not come with a front end sales load. However, there are potential drawbacks to Class B shares. As with every potential investment, carefully study the benefits and disadvantages to decide whether this type of share will work with your financial goals.

Work with your financial advisor to locate mutual funds that offer class shares. Not all funds have these types of shares, so you may need a professional to help you find and manage your funds.

Learn about the shareholder services and distribution arrangments for Class B shareholders for the funds in which you're interested. These services and arrangements will vary widely, so pay careful attention to what each mutual fund is offering you.

Find out whether the mutual funds you want charge a front end sales load, however slight. Although Class B shares are technically bought without a front end sales load, funds can charge a fee up to 1/4 percent and still be considered a 'no load' fund.

Ask about contingent deferred sales loads (CDSL) for early redemption. Most mutual funds waive the CDSL once you've owned the shares for a specified amount of time, usually around 6 years.

Consider the 12b-1 fee attached to most Class B shares. This fee pays for shareholder services, financial advisors and insurance agents. Class B shareholders are charged a 12b-1 fee annually until they sell or convert their shares.

Find out whether your Class B shares will convert into Class A shares in a few years. This will help you decide whether to invest in a mutual fund long term and will give you ideas on how to manage it.

Tips & Warnings

• If you want to manage mutual fund with class shares, it may be wise to start with Class B shares. You won't pay the front end sales load and there's a good chance your shares will convert to preferred Class A stock after 5 years.
• Watch out for exhorbant 12b-1 fees. Some mutual funds use these fees in place of front end sales loads. Unscrupulous brokers are encouraged to sell the Class B shares with the knowledge that they'll receive kickbacks from the mutual fund in the form of 12b-1 fees.

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Manage an Institutional Fund

Traditionally, corporations, endowments, pension funds and wealthy individuals have been the primary investors in institutional funds. With a typical minimum investment requirement of $1 million, it's not hard to see why. Lately there has been an increase in individuals without a great deal of personal wealth investing in institutional funds. Discount brokers have made it possible for the average investor to get started with as little as $1,000 or $5,000 to invest. Read on to learn more about institutional funds, how to manage them and how to make them a part of your portfolio.

Understand Institutional Funds

Find out what an institutional fund does. Institutional funds try to reduce risk by investing in hundreds of different securities.

Learn how institutional funds work. By trading securities rather sporadically, institutional funds are able to keep operating costs to a minimum. These savings are then passed on to investors.

Buy Institutional Funds

Locate an institutional fund you can invest in. Historically, it was impossible to invest in an institutional fund with less than $1 million. Now, thanks to discount brokers, it is possible to purchase shares for as little as $1,000.

Evaluate the fund's past performance using a ratings indicator.

Ask for a copy of the prospectus. The prospectus will give you a good idea of who will manage your fund, what expenses are incurred and the investment philosophy of the fund.

Determine whether the institutional fund is right for your investment needs. Based on the fund philosophy, management style, performance and rating, you should have a good idea of whether or not you want to invest in the fund.

Find out how you can invest in the fund. You can find this information by looking at the stock quote on a financial Web site or by calling the fund directly.

Tips & Warnings

• Even if you can't invest in an institutional fund, that doesn't mean you can't learn from one. Watch to see where the big companies are investing their money. In doing so, you may get some investment ideas of your own.
• Don't get an institutional fund confused with an institutional investor. An institutional investor is a person or organization involved in trading a large enough quantity of shares to qualify for preferential treatment and discount broker fees. Since institutional investors have a great deal of knowledge about the investment world and know how to successfully manage their portfolios, fewer protective regulations are in place for them.

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Manage an Aggressive Growth Fund

For investors who want rapid gains, there are few options more attractive than aggressive growth funds. However, these funds come with a high level of risk. They can also be difficult for investors to manage, especially novice investors. Find out exactly what aggressive growth funds are and why they can be good for your portfolio. You'll also discover common pitfalls of these funds as well as how to make a conscientious investment decisions.

Understand Your Aggressive Growth Fund

Learn about the goals of your fund. Aggressive growth funds aim to give the highest gains possible through high-risk investments with high profit potential.

Discover your options. The most typical types of investments involved in aggressive growth funds are high-risk stocks, such as initial public offerings (IPOs). Portfolio managers who deal with aggressive growth funds are attracted to these stocks because of their potential for fast growth.

Buy an Aggressive Growth Fund

Make an outline of your long- and short-term goals before you look at aggressive growth funds. This will help you determine whether the risk is worth your investment.

Consult with a financial professional before investing in an aggressive growth fund. An adviser with solid experience managing this type of fund will be in a good position to weigh the pros and cons of investing in a high-risk stock.

Compare several aggressive growth funds to see which one would be best for your retirement goals. You can find information about funds by visiting a financial Web site, like Moody's or Morningstar, or you can look through the financial section of your newspaper.

Look at the prospectus for every fund you may invest in. You'll find valuable information about the board of directors plans to manage the fund, how the fund has performed in the past and information about the distribution agreements.

Purchase your shares the least expensive way possible. When you buy directly from the fund, you'll save yourself a lot of money. You can also buy from a fund supermarket or a licensed broker.

Tips & Warnings

• If you're a first-time investor, it may be a good idea to consider investing your money in a less-risky mutual fund until you get the hang of buying and selling shares.
• Give yourself more stability by investing in other stocks and bonds in addition to an aggressive growth fund.
• Keep in mind that aggressive growth funds are among the riskiest and most volatile mutual funds. Although the potential for high returns is great, aggressive growth funds require consistent monitoring for the best results.

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Manage a Sector Fund

Sometimes you need your investments to perform as quickly as possible. When your circumstances change suddenly, or you find yourself short of a necessary financial goal, you might need the help of an aggressive fund that has high earning potential. One way to achieve rapid investment growth is by investing in a sector fund. This type of fund can be difficult to manage and is not without serious risks, but it is worth considering when you need to see fast investment results.

Understand Your Sector Fund

Know what it is. A sector fund has investments in a particular industry. For example, there are sector funds for the automobile, technology and health care industries.

Learn the purpose of a sector fund. Designed to be high growth, sector funds are an option for investors looking for extra capital as quickly as possible.

Invest in a Sector Fund

Make a list of your financial goals. For short-term investment strategies, it may make more sense to place your money in a riskier, higher-yielding industry. For long-term financial planning, you may want to stick with tried-and-true sectors.

Narrow down your list of potential sectors to between 3 and 5. You can do this by learning about each sector and examining their advantages and pitfalls.

Compare each sector to find the one that best fits your goals. Are you aware of any publicized upcoming changes in any of these industries that might make the stock fluctuate drastically? You'll need to carefully and objectively examine each industry.

Remember that performance isn't everything. You'll also want to know who is going to manage your fund and how they will do so. Fees, expenses and distribution arrangements are essential areas to study.

Manage your portfolio defensively. Who better to keep a close eye on your money than you? Changes within your sector, news stories and current performance can all have an effect on your shares.

Tips & Warnings

• When investing in sector funds, it's important to thoroughly investigate the industries you're interested in. Knowledge of sectors is your greatest defense against losing money.
• If you're nervous, try sticking with traditional top performers, like the health care and finance industries.
• In spite of preparation, sector funds are widely known as risky investments. It's virtually impossible to predict whether an industry will stay in favor, as witnessed by the downturn of the technology and telecom sectors from 2000 to 2001.

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Manage a Regional Fund

If you have little capital, but still want a diverse international portfolio, a regional fund may be the answer for you. These funds are designed for the average investor who may not have enough capital to adequately diverse himself or herself without the benefit of a mutual fund. Before you invest in a regional fund, it's important to understand exactly what they are.

Understanding Your Regional Fund

Find out what it is. A regional fund is one that focuses on securities from an entire region, such as Europe or Latin America. There are some regional funds, however, that focus solely on one country.

Learn why regional funds are used. Buying stock in foreign countries can be a difficult, confusing and expensive process. Regional funds are designed to facilitate these transactions and give investors the opportunity to expand their portfolios to overseas interests.

Discover your investment options. Most regional funds strive to provide investors with a diverse range of stocks from companies based in or operating out of the area of interest. However, some regional funds are invested solely in a specific sector of the area's economy, like transportation.

Understand how they operate. Fund managers choose the securities included in a regional fund based on specific geographical criteria.

Decide on a Regional Fund

Explore the variety of regional funds currently available. A good place to begin your search is on a financial Web site (see resources).

Choose a few funds that sound interesting. You don't need to select one now, so feel free to be as liberal with your choices as you want.

Investigate each offered region. Is there something that draws you to the area? Are you impressed with the level of growth in the region? Knowing your reason for wanting to invest in a region will give you more incentive to manage it well later.

Narrow down the field to a few attractive possibilities. A great way to do this is by looking at all aspects of a given region, such as future potential, past performance and emerging industries.

Ask for a copy of the prospectus for each fund you're interested in. You can request one for free from the fund's manager.

Tips & Warnings

• Regional funds are considered to be very volatile. Although they can reap high rewards, there is always the risk of country-wide recessions and disasters.
• Expect to carefully manage your regional fund. This is definitely not the type of fund that can manage itself.

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Manage a Municipal Bond Fund

If you help satisfy debt obligations that local and state governments owe for projects, like new schools and hospitals, these governments are willing to pay you tax-free interest on your money. Municipal bond funds are very attractive to many investors because of their tax-free benefits. Although these bonds aren't taxable, they aren't exactly a cash cow either. Municipal bond funds are notorious for giving a lower yield than other comparable tax bonds.

Invest in a Municipal Bond Fund

Decide what your investment needs are. Planning ahead can help you better manage your portfolio. Situations that require rapid growth within a few years, such as upcoming college tuition fees for your children, may not work with municipal bonds.

Find municipal bonds with a solid rating. Remember that all ratings are based on the quality of the issuing government.

Ask how the fund prices its holdings. You'll find that municipal bonds are traded sporadically, giving investors little knowledge of current market pricing. As an alternative to contacting customer service directly, you can look at the fund's prospectus.

Investigate the fund thoroughly. If you're going to properly manage your portfolio, you'll want to know every aspect of how your fund operates, from pricing evaluations to how to get answers to essential questions.

Get to know the person who will manage your municipal fund. Investing your money is no joke, so you'll want to feel confident in the person you're entrusting your money to.

Determine the appropriate method for purchasing shares. Will you need to go through a broker? Can you buy the shares directly from the fund? You may find that one method is more expensive than the other, which may influence your decision.

Tips & Warnings

• If you're in a higher tax bracket, it is probably more sensible for you to invest in a tax-free municipal bond. Individuals in lower tax brackets, however, would more likely benefit from investments with a higher pre-tax yield.
• If the bond fund you've invested in covers certain private activity projects, then the interest dividends you receive from it may be subject to taxation under the federal alternative tax system.
• Be careful of over-inflated pricing. The fund manager has a great deal of control over the current net market value (NMV) of the fund. There have been instances of fund managers boosting their NMVs unrealistically through the help of independent fund evaluators.

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Manage a Crossover Fund

Mutual funds are a great way to save for retirement, as there are a wide variety of options available to potential investors. Depending on your risk-tolerance level, you can invest aggressively or conservatively. If you're not too close to retirement and would like to maximize your potential profit, take a look at crossover funds. An innovative blend of public and private equity investing, crossover funds are among the fastest growing investment types in the United States.

Understanding Crossover Funds

Learn about crossover funds. These types of funds are a combination of both public and private equity holdings.

Find out about public equity. Chances are, if you've heard about a stock, it's public equity. These shares come from public companies and are traded on the open market.

Discover private equity. Investments that are considered private equity are not traded on a public stock exchange. There is a wide range of private equity categories, including venture capital, mezzanine capital, leveraged buyout and angel investing.

Determine your risk level. In order to properly manage your crossover funds, you'll have to accept the high level of risk involved. Crossover funds usually have a higher risk, but yield higher returns.

Discuss your investment plans with your financial adviser. You'll need an experienced financial guru to help you invest in crossover funds and manage your portfolio.

Buy and Manage Crossover Funds

Make a short list of potential crossover funds. You can find information about crossover funds on major financial Web sites. Alternatively, you can also look in the finance section of your local newspaper for mutual fund information.

Choose your fund by carefully studying the prospectus, performance and management policies of each one.

Resist the urge to sell your shares if your fund has a poor year. Most funds experience ups and downs throughout the year, but rebound over the long term.

Consider selling if your fund has been seriously underperforming for 2 consecutive years. There's no shame in admitting you've selected a bad fund, but make sure you get out in time.

Tips & Warnings

• Don't confuse crossover funds with crossover investors. The latter deals with investing in companies throughout their initial public offerings (IPOs) and has nothing to do with managing public and private equity funds.
• Keep in mind that all investments come with some level of risk. If you're not comfortable with the investments you've made, contact your financial adviser immediately.

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Manage a Closed Fund

Most of the mutual funds available to investors are known as "open funds." This means that investors can buy and sell shares on a continual basis. Once a fund becomes closed, however, buying and selling are usually not permitted. To get an idea of the big picture, you'll need to gather information about closed funds and learn how you can invest in them.

Understanding Closed End Mutual Funds

Find out what closed end mutual funds are. These mutual funds become closed to new investors once operations begin. In most cases, shares are traded on a public stock exchange.

Learn how closed end mutual funds work. When a closed end fund goes public, investors are permitted to buy into the fund's limited number of shares. Once all shares have been sold, the fund managers invest the profit and the fund moves to a secondary market.

Decide whether this investment fits your personal goals. Closed end funds aren't usually considered high-risk investments, but you may find that the time investment involved doesn't suit your needs. This is especially true if you are on a tight investment timeline.

Talk to your financial adviser. Not only will you learn more about closed end funds, but you'll also get valuable insight into why they may be the perfect complement to your portfolio.

Buy and Manage Closed End Mutual Funds

Browse through upcoming funds to find one you're interested in. You can find a great deal of mutual funds online at most major financial Web sites, like Forbes and Money (see resources). Newspapers also publish information about mutual funds in their finance section.

Find out when shares in the fund you want will be available for purchase. Your best option is to look in the fund prospectus or call the managers for more information.

Discover your buying options. You may be able to buy shares directly from the company. Alternatively, you can also invest through a broker or a fund supermarket.

Work with your financial adviser to manage your portfolio. Closed end funds usually take little or no management. Under certain circumstances, however, you may need to make buying and selling decisions.

Tips & Warnings

• Find out if it is possible to purchase additional shares in your closed fund. Some fund managers occasionally permit existing shareholders to purchase outstanding shares.
• Keep in mind that closed end funds are not without risk. Always analyze every fund before you invest your money, and consult with your financial adviser in depth to determine whether this style of investing is right for you.
• Most investors consider closed end funds to be highly complicated. Therefore, they are not recommended for beginning investors.

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