Mutual funds are a good way for the small investor to get involved with the financial markets. They allow the small investor a way to invest in a group of stocks without actually having to purchase the individual shares. Most company retirement plans offer these as an option for their employees. In these plans the investment minimums are waved. If someone wanted to invest in these funds in a private account for perhaps a college fund, the minimum investment may be too high for many. If you can afford it, you may still find it difficult to invest in multiple funds for the sake of keeping your portfolio diversified. There is good news though. There are many good companies out there that will allow a person to open an account with as little as $100.00. You only need do a little research to find them. Below I will explain how.

A good place to start is morningstar.com . They are one the top rating services of mutual funds available. You may have seen their ratings mentioned in financial publications and referenced in some prospectus. Here you will be able to search for funds based on the perimeters you set. You can also find the best best no load mutual funds. To do that go here: http://screen.morningstar.com/FundSelector.html Link below.


Here you can set the minimum investment as well as returns and other options for your search. It’s best to look for no load funds. If not, and you invest in a fund with a load then you are starting out in the hole since you paid a fee to buy the shares. Once you have found the funds that interest you, contact the company and request a prospectus. This will explain how the fund is managed, their philosophy, performance, holdings and other information on investing in the funds. When choosing the funds to invest in remember that past success is no guarantee of future results. If you plan to invest in multiple funds, you may want to diversify your portfolio by choosing funds that invest in different sectors. This can be a form of protection where as a particular sector may not be doing well you will have others to shore it up. Remember to that mutual funds are meant to be long term investments.

     Once you have made your choice, you only need to fill out the necessary application and mail it in with you check. A confirmation with you new account numbers and reinvestment details will be sent to you shortly. Plan to reinvest in the fund preferably at regularly scheduled intervals. Trying to pick the high and lows to invest or not, rarely if ever works out. By buying new shares at regular intervals you will be averaging your cost and will fare much better. With patience, discipline and a little research you should be able to put together a nice portfolio and get your piece of the pie.