Choosing Suitable Funds

: Your diversified portfolio is likely to be one-of-a-kind because the unique combination of factors that define your goals, timeframe, and risk tolerance won’t be exactly the
 same as any other investor’s.

Mutual Funds

Provides diversification 


May not be focused 


May not be fully invested

Index Funds & ETFs (Exchange Traded Funds)

Seek to replicate index results

Transparency 


May be more tax efficient 


Poor performance in down market

Individual Securities

Investments must be balanced 


Need a varied, representative sample 


Can be costly to diversify

Performance must be monitored

Managed Accounts

Professional management

Advantage of multiple managers

When you invest for retirement, you can select a portfolio of individual securities, mutual funds, and ETFs or choose a target date fund. Its objective is to build and then preserve assets, so that investors in the fund can look forward to a more financially secure retirement. To meet its goal, a target date fund assembles and regularly realigns a port- folio of individual mutual funds to: Help manage investment risk without significantly reducing return during the fund’s growth phase. Try to provide continued, if some- times modest, growth during the fund’s income-producing or asset-preservation phase

Since cost has an impact on your return,
you’ll want to compare the expense of buying and holding various investments. As a rule, no-load mutual funds with low annual expenses, ETFs that you buy for a modest or no commission and hold for an extended period, and individual securities you buy and hold in the same way are generally the least expensive.

Contributions from the book Guide to Understanding Life Insurance in this press release are used with permission from Light Bulb Press.