Types Of Mutual Funds

By: Arcel

There are many types of mutual funds available in the market but only four can be found in the Philippines, and these are: stock or equity funds, bond funds, balanced funds, and money market funds.

* Stock or Equity Funds. Stock or Equity Funds pose a higher value for the investment. While that may be the case, any investment which poses higher returns have corresponding risks therefore the stock or equity funds contain very high risk. These funds are invested in Philippine corporations enlisted in the Philippine Stock Exchange.

* Bond Funds. Among the types of mutual funds, the bond funds poses lower possibilities of loss. It is a conservative means to drive towards asset growth. These funds are invested in fixed-income securities, these includes bonds or treasure notes issued by the Philippine Government and other commercial papers.

* Balanced Funds. These type of mutual funds is balance between the equity funds and the bond funds because while equity investments provide potentially higher income, they are tempered by the conservative growth of fixed income securities.

* Money Market Funds. While money market funds are similar to bond funds, they are different because money market funds are usually invested for shorter periods of time. But both of them are invested in fixed income securities and have the entails conservative growth.