Vanguard is a very highly regarded mutual fund company. They are a mutual, which means they are a non-profit. Their fees fall every year, making them a favorite of many.
It was about a decade ago when I got seriously interested in personal finance and investment. I read many investment books and all of Warren Buffet's shareholders letters. The world of investing is extremely confusing. This website constaints most of what I have learned. Hope you find it useful.
March 4, 2010
What mutual funds are considered a good investment?
February 28, 2010
How exactly does mutual funds work?
How exactly does mutual funds work?
November 5, 2009
The Mutual Fund No Load List: The Top Funds To Consider
With mutual funds, it is very easy to be distracted by high investment returns and slick marketing. The mutual fund industry spends millions of dollars on glossy magazine and television ads. Where do they get money to splurge on ads? Fees paid by their investors of course! Over time, these expenses really bite into returns. That’s why many individual investors are looking for a mutual fund no load situation.
In mutual fund investing, “load” typically means “front-end load”. Usually the fund company takes 2.5% or 5% right when you deposit your money. This is without them doing any work! Usually this cash is used as compensation to the broker that sold them to the investor.
The conflicts of interest are obvious. What you’ll find that many funds with high load aren’t that great. But they are huge with billions of dollars invested because “financial advisers” keep pouring money into them for the gravy. Regulators are trying to make mutual fund investing fair for the average investor but the financial services industry is extremely powerful.
That leaves it to the individual to decide what is best for him or her.
Be sure to do lots of online research before putting money into the fund. Check out many websites and free reports and such. This can take a decent amount of time because there is lots of information to digest. But this will all pay off in the end. Even if after all your work your investment returns are only a few percentage points higher, this amount of money can add up to a tidy sum over time. Investing is like building a snowball. BTW I’m reading Warren Buffets biography right now (”The Snowball” and its an amazing piece of writing. 
You should also probably consider index funds. I guess I am biased in this regard. If you look at the entire history of actively managed mutual funds, very few outperform their benchmarks in the long run. This is why I have much of investment fund put into what are known as index funds. They don’t try to beat the market. They merely try to match it. There’s no overcompensated financial wizard running the fund. They keep costs low. And the vast majority have no load.
August 7, 2009
The Best No Load Funds Revealed
Investors always strive to improve their investment returns. One of the most popular ways in recent times is the use of mutual funds with no load. Fees are often overlooked by many investors. This is very foolish because they can greatly hamper investment returns. This is especially true if the load is “top-end” (a significantly percentage is charge to the investor simply buying into the fund, usually used to compensate a broker.)
Fortunately the industry seems to be going towards low fees. This is because of the mutual fund scandal a couple of years ago. It was revealed that some investors (in particular some union clients) were buying and selling into funds with “stale” prices. A couple state attornies were able to get a settlement with the major mutual fund companies. One big part of this agreement was the lowering of fees for the everyday investor.
The first fund family that a no load investor should consider is Vanguard. They are the innovators in the regard of their focus on indexing and low fees. And in contrast to other major firms they are owned by their investors. This means they are not run to maximize profit but to get the best return for their investors. The fees on some of the most popular funds has fallen greatly over the past few decades because they have achieved economies of scale. And instead of using the lower costs to increase profit, the company has passed on the savings to their customers. This is why Vanguard is such a popular choice today for individual investors.
When selecting a fund, be sure to cognizant of your overall financial goals. Do not take on more risk than you can afford. Also be sure to obtain enough diversification. If you are focused on low fees, indexing is an excellent option.
July 22, 2009
Are No Load Index Funds The Future?
Index funds are very popular today. This is because of the mutual fund scandal several years ago. A couple state attorneys (including the infamous Spitzer) got together and went after the fund industry because they thought the average investor was getting ripped of. This attracted a lot of medial spotlight and many individuals rethought their investments. This has highlighted the benefits of index funds. When combined with a no load fee structure they can be advantageous to investors in many ways.
Index funds are not like at all like active-managed funds. They do not have portfolio managers and stock analysts trying to make their fund outperform the general market. Instead, the asset manager tries to match the market. This seems counter-intuitive to many people. But the fact remains that very few people outperform the market in the long run. And by saving on fees, the investor is better of.
They used to be available on only the most popular indicies, such as the Dow Industrial Average and the Standard and Poor’s. But the popularity of index funds has grown immensely. There are now indexes for everything imaginable, including global (usually based on the MSCI), bonds and energy stocks. You can build any type of portfolio you want with as much risk and reward built into it as you wish.
What is also great about index funds without a load is that there is already built-in diversity. Every fund manager always proclaims that their fund can withstand a sharp drop in stock values. But whenever there is a crash there are always a lot of funds that are caught with their pants down. Perhaps they were overweight in tech stocks or oil stocks. It turns out they didn’t diversify risks as much as they thought they did. With an index fund you don’t have to worry about this type of human error.
Load charges are typically used to compensate brokers. And they can take a huge bite out of your investment returns. A 5% initial charge to enter a fund does not sound like a lot. But when you take into account compound interest, this can end up costing you tens of thousands of dollars in the end.
A no load index fund is one of the lowest cost investment options availble to the indivual investor. Not only is there not a fee to buy in (as previously mentioned) but the ongoing management fee (expense ratio is a popular term) is relatively very low compared to other funds. This is why many savvy personal investors choose this option.
March 13, 2009
The best of the top no load mutual funds
This site will start ranking no load mutual funds. Right now the best are:
1) Vanguard
2) Fidelity.
Vanguard is famous for having low fees. It is actually not a for-profit corporation but is in fact owned by its investors. So they keep dropping fees.
March 9, 2009
They have arrived: Mutual funds with no load
This site will cover the best no load mutual funds. But what parameters does a top fund exactly have? More importantly, we should first explain what exactly the type of mutual fund we will be discussing.
The popularity of no load mutual funds has skyrocketed in recent years. The big number most investors spend time spend all their time comparing are returns. What is often missed is performance net of fees. Fees aren’t everything but over the long term they can greatly affect financial results.
When an investor buys shares of a normal load fund, he is charged a sales commission to compensate the broker. There are various ways this can be done. The two most common are either “front-end” or “back-end” - charged when the fund is bought or sold respectively. They can be quite high and some funds charge as much as 8.5%. That means if you invest $1000 in a 8.5% front-end fund, $85 of your money is immediately deducted for sales commision and only $915 of your money is actually invested in the fund. This can greatly skew your investment peformance over both the short and long term. Many funds with front-ends are also adding 12b-1 fees (paid continuously, not a one-time fee) to go towards the cost of selling the funds.
In contrast, a no load investor pays no commission to buy into or sell out of the fund. There are two ways of doing this. You can go directly to the fund company, like Vanguard. Or you can go to a company like Charles Schwab and buy from their mutual fund “supermarket”. Many investors doing these days are choosing the second option. There is great convenience with a single account for all your mutual funds, with a single monthly statement. It also makes thins much easier when tax time rolls around.