A Typical Investment Portfolio
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A typical investment portfolio consists of stocks, bonds, real estate holdings, and other types of assets that provide varying degrees of financial security. However, both novice and experienced investors are also routinely advised to buy into mutual funds when they want to build portfolios that allow for better degrees of confidence. You can confidently add mutual funds to your own portfolio by learning some of the primary advantages that they offer to investors today.
Diversification
Mutual funds provide you with the diversification that you need to get the highest degree of security from your investment portfolio. They offset the risk that can come with investing in stocks in the retail, industrial, and other sectors. They also counter bonds that have varying degrees of maturity.
Further, mutual funds are typically low in cost and more affordable than buying individual stocks and bonds. You can buy mutual funds for as low as a $200 to $300 depending on the robo-advisor or financial planning services you use. A certified management accountant like James Dondero can tell you what mutual funds offer the lowest initial investment and offer the highest degree of ROI.
Best Value
As noted, mutual funds tend to be low in cost and easier to purchase than individual stocks and bonds. They also provide you with the best value for your money.
By allowing a certified financial analyst like James Dondero to guide you in buying mutual funds, you essentially get a discounted rate per stock because you are buying in bulk. Mutual funds also help you avoid costly individual transaction fees. You can make more transactions without having to spend a lot of money.
Professional Management
Mutual funds are managed by a professional money manager. This money manager uses your money to buy stocks for you that he or she has carefully researched.
This research ensures that your investment is secure and that you reap the largest ROIs possible with each mutual fund. Professional money managers also take the guesswork out of deciding what stocks to invest in and how much money to put into each fund.
Liquidity
Finally, mutual funds are easier to liquidate than other types of investments like stocks, bonds, and real estate. When you sell your mutual funds, you stand a greater chance of getting back what you initially invested if not more if the fund appreciated in value.
However, you can only sell mutual funds once per day. You must wait until the fund’s NAV (net asset value) is calculated. The time of day that you sell could impact its value. You can get the highest ROI for your mutual funds by following the advice of a certified financial adviser like James Dondero.
About James Dondero
James Dondero began his career in the financial industry in 1984. Since then, he has become an industry leader, having worked for top companies like American Express and the GIC subsidiary of Protective Life.
He now serves as the CEO of Highland Capital Management, L.P. in Dallas. He is also the chairman of the board for companies like NexBank and HCM Acquisition Company.
Dondero volunteers extensively for academic and charitable organizations throughout the Dallas area. Some of his charities include Snowball Express, Education is Freedom, and SMU’s Tower Scholar Program. He also supports the George W. Bush Presidential Library.
