1.01.2007

Mutual Funds- They put the “Fun” in Funds!

Mutual funds are amazing in their own way. The only problems with them are that that have a risk factor and it’s better to be putting money into it weekly, bi-weekly, or monthly. Lets say you are putting 50 dollars in it every week. The first week, the stocks are selling for 10 dollars each so you buy 5. The second week they’re selling for 5 dollars each. Then they even out to 7.50 dollars each, but you don’t buy any. So how much money have you made? Nothing, right? WRONG! You bought 15 shares, and selling them for 7.50 each, that would be 112.50! 12.50 cents profit out of investing 100 dollars for only 2 weeks! Not bad! Mutual funds are great for holding your 10 percent fund. If in the beggining it goes really low, don’t worry. It just means that you’re buying up lots of shares, so once it raises in price, you’ll make lots of profit. The best way to get the most out of your mutual fund is to wait until you’re going to retire in a few years, then wait for it to raise in price. As soon as it rises, sell it and don’t risk leaving your retirement fund being worth little when you’re retired!

3 comments:

John said...

Okay thank-you for that clarification… I guess I missed that part. Keep up the great work!!!

John said...

Then they even out to 7.50 dollars each, but you don’t buy any. So how much money have you made? Nothing, right? WRONG! You bought 15 shares, and selling them for 7.50 each, that would be 112.50!

I’m sorry but this statement doesen’t make sense to me. You are paying 7.50 for each of your 15 shares. You sell them for the same amount of money so your profits are zero. But wait theres more! You would pay at least 10% tax so in my books i’m losing money on that deal.

Munnybagz said...

umm no youve bought 5 shares at 10$ each and 10 at 5$ each that’s 15 shares at 100 dollars for all…