Balanced Mutual Funds

Way back when I first started learning the investing basics it was all about buy sell buy sell! How many stocks could I buy and how quickly could I do it? As you can imagine, I wasn’t too successful. Even if my stocks inexplicably returned a profit the broker’s fees absolutely killed my overall takings. A friend put me on to mutual funds and although they don’t quite give me the same buzz as buying stocks does, my returns have certainly improved.

After I had a few mutual funds setup I started to notice that performance of some of them was quite sporadic. I remember thinking how people had told me this was a safer way to invest. Not from what I could see! I started to research dividend paying stocks and the topic further and that’s when I found out about balanced mutual funds and how they offer a safer way to invest. After the economic downturn in 2008 I had a serious look at my portfolio. Some of which had been hit pretty hard. From that day on I swore to take a much more cautious approach to my investing life. My motto now is very much safety first.

Balanced mutual funds are safer for various reasons. One of the biggest mistakes investors make is to have all their eggs in one basket. You should never have the majority of your holdings invested into one company and if you can spread across different commodities too. Balanced mutual funds take this approach by putting a cap on the amount invested in any one asset. The money is also spread across different markets so you could end up with bonds as well as stocks as part of your portfolio.

In short, check out balanced mutual funds as they are becoming the safest way for anyone to invest in the stock market. If you’re looking to reduce your financial risks then this is the way to do it. It can be a very successful way to make money when used along with buying stocks that pay dividends.

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