Mutual Funds

[risknothing]

Currently all money i have (which is not very much) is in CD's or Internet Savings accounts. Soon i believe it may be time to look towards mutual funds. However, i dont grasp the whole concept. I was just looking at the ING mutual funds and I cannot find out how much it will cost me to invest or how much the management fees are. Also, what mutual funds does anyone suggest?

Thanks

[Ima saver]

Re: Mutual Funds

I would suggest you call Vanguard and ask for a prospectus. They offer no load funds and there fees are the lowest of any available. I would reccommend the vanguard Index 500 fund. It has an average annual return of over 10%. That is where I have all my roth and regular ira money! Vanguard has been around for along time. I would not reccommend ING mutual funds, they are too new.

[risknothing]

Re: Mutual Funds

what is your opinion of VDIGX fund?

[Ima saver]

Re: Mutual Funds

It did well last year, a return of almost 10%. Since inception, it has returned 7.62%. Index 500 VFINX has returned 12% since inception. It is generally believed that Index funds do better over the long haul.

[risknothing]

Re: Mutual Funds

yeah but VFINX cost $120 a share. With the money im going to put in i will see almost no increase. What about ING Direct's fund IDROX. It looks to have huge returns

[WellManicuredMan]

Re: Mutual Funds

Index 500 VFINX has returned 12% since inception. It is generally believed that Index funds do better over the long haul.

I agree. It's not worth it to pay someone a lot more money for the chance that their fund might beat the market. Just go with an index fund that tracks the broad market and pay a LOT less in fees.

[risknothing]

Re: Mutual Funds

well what is another good index fund because i dont see how it would be good for my to invest the min of 10,000 in a $120 mutual fund. It goes up 1 dollar i gain almost nothing.

[Ima saver]

Re: Mutual Funds

The minimum to get into Vanguard is $3000. It really doesn't matter how much each share costs, just what percentage it earns each year. Vanguard has the lowest of all costs in funds, so It is the best one to go with. They all invest in the 500 top stocks, so they are all the same except for expenses. Vanguard's costs are the lowest.

[WellManicuredMan]

Re: Mutual Funds

well what is another good index fund because i dont see how it would be good for my to invest the min of 10,000 in a $120 mutual fund. It goes up 1 dollar i gain almost nothing.

You do have to have at least $10,000 to avoid the $10 maintenance fee for VFINX but if you have that much I say go for it. Unless you want to be more diversified, you could buy VTIVX instead.

[Ima saver]

Re: Mutual Funds

Agreed, it had good results last year, over 11%

[risknothing]

Re: Mutual Funds

when a mutural fund says 5 year return of 7% does that mean total or per year? Because if it is total wouldnt it just be better to put your money in CD's?

[Ima saver]

Re: Mutual Funds

That is the average that is made, like one year it made 10% and one year is made 3%. You don't usually average 7% in a c.d.

[risknothing]

Re: Mutual Funds

So the VFINX says that its performance over 5 years in 8.8%, that means that it has increased over 8% per year of 10 years?

[Ima saver]

Re: Mutual Funds

The info I have says tht vfins has adveraged 8.24% annual return over the past 10 years, as of June 30, 2006! (VFINX) That is the adverage return every year for the past 10! My vanguard ira was worth $23,000 in jan of 1997. Now it is worth close to $70,000. I have put some money in, but only $2000 a year. I have not put anything in the past 4 years because we now build spec houses, which we sell for profit.

[risknothing]

Re: Mutual Funds

so im thinking i may start with the min of 3000 for the VTIVX fund? What do you think?