mutual fund

JC Rodriguez
June 03, 2024

Happy Monday folks! New week!

DEFINITION
What are mutual funds?

Here’s an analogy: Think of a mutual fund like a collaborative playlist on a music streaming service, like Spotify. Imagine you and a bunch of friends each put in a few songs that you love into one big playlist. Instead of each person listening to their own separate song, you all get to enjoy a mix of everyone’s favorite songs.
Just like how a playlist can be curated by someone, a mutual fund is managed by professional investors who pick a mix of investments for you. This way, you don't have to spend time picking each song (or stock) yourself, and you get to enjoy a more diverse and balanced listening (or investing) experience. The diversity of songs helps ensure that even if you don't like a few tracks, there are still plenty of others to enjoy, which is similar to how diversification in a mutual fund can help lessen the risk of some investments performing poorly.

Using a mutual fund is a smart way to start investing, especially if you're new to it or don't have a lot of money to invest on your own. It's like getting a head start in a race by running with a team. You get the advantage of professional management, so experts are making the decisions on where to invest your money. Plus, because you're sharing the investment with others, it's less risky than putting all your money into one stock or bond.
So, if you're looking to grow your money over time and want a safer, more diversified way to invest, a mutual fund could be a great option. It's an easy way to get started and learn about investing without having to be an expert yourself.

One mutual fund I am highly invested into is the “Fidelity Blue Chip Growth Fund” Check it out, and see how it’s performed over the last 10 years.

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