Types of Open End Mutual Funds

Open end mutual funds and open end mutual fund investing are more popular than closed end mutual funds. In mutual fund research, it is necessary to know the types of open end mutual funds that are available. There are so many open end mutual funds out there, making the mutual fund research process more complicated. With so many types of open end mutual funds, it is difficult to classify an open end mutual fund by type or investment objectives.

Most mutual funds you see available on the market are open end mutual funds. If a mutual fund has a TICKER symbol, it is most likely an open end mutual fund.

Mutual Funds Investment Objective

An example of an open end mutual fund investment objectives is an open end mutual fund with an objective to invest in small growth companies. Another example is open end mutual funds that aim to provide shareholders with maximum dividend income and therefore only invest in dividend paying stocks.

Aggressive growth mutual funds

Aggressive growth mutual funds seek maximum capital gains as their investment objective. Current income is not an important factor. Some aggressive growth mutual funds may invest in stocks of businesses that are our of the mainstream, such as fledgling companies, new industries, companies fallen on hard times, or industries temporarily out of favor. Some may also use specialized investment techniques such as option writing or short term trading.

Balanced mutual funds

Balanced open end mutual funds generally have a three part investment objective:

• to conserve mutual funds investors' initial capital
• to provide current income to mutual funds investors
• to promote a long term growth of both principal and income

Click here to read more about other types of open end mutual funds