Most mutual fund companies now have Web sites that make their
products and services far more accessible. Instead of ordering
literature and waiting a week to receive it, in most cases
you can call it up on the computer for immediate access.
While mutual fund companies generally stick to selling just
mutual funds, many offer an abundance of value-added information,
tools, and research that can help make mutual fund investing
easier than ever.
Services: All offer real-time quotes, research, fund
manager interviews, individual fund profiles, investment information
and tools; some offer Web site account access and check-writing
privileges.
Products: Mutual funds, ranging from a single offering
to a family of dozens of different fund choices.
Payment: Mutual funds make money from one or more
of the following:
- Annual administrative fees, generally a minimal flat fee
charged for operating the fund.
- Investment fees to compensate the money managers.
- Early surrender charges are sometimes charged if you cash
out your investment within the first few years.
- Transfer fees charged when investors transfer assets from
one fund to another within the same fund family (used by
some, but not all fund companies).
Benefits: If you want to invest solely in mutual funds,
many mutual fund families offer a broad spectrum of choices
for one-stop shopping, as well as consolidated account statements,
quarterly reports, annual reports, and ongoing investor relations
newsletters and informational materials.
Disadvantages: If mutual funds represent only one
portion of your investment portfolio, you will receive separate
statements and other account information when you invest through
the mutual fund company. Were you to invest through a brokerage
firm, it would consolidate all of your portfolio information
in single mailings and easy-to-read account statements.
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