7 Best Mutual Funds to Invest in 2022

One of the best ways to invest in bonds and the stock market is through mutual funds. It is with the aid of mutual funds that you can buy a diversified collection of assets in one fund that has a low cost. It is an easy way for an investor to diversify their income portfolio. In the course of this article, we will be looking at the top ten mutual funds that you can invest in.

1. Schwab Fundamental U.S Large Company Index Fund (SFLNX)

This is a mutual fund that is used to invest in large publicly traded companies. It helps to track the total return of the Russell RAFI U.S company index. The annual of the SFLNX over the last 5 years is 15.0 percent, while its expense ratio is 0.25%.

2. Voya Russell Large Cap Growth Index Fund (IRLNX)

The Voya Russell Large Cap growth index fund is a mutual fund that is used to track the performance of the Russell Top 200 growth index. It is important to note that the annual return of the IRLNX over the past 5 years is 26.3%, which is why it is the go-to mutual fund for increasing your income portfolio as an investor. The expense ratio of the IRLNX mutual fund is 0.43%.

3. Fidelity 500 Index Fund (FXAIX)

This is a mutual fund that is a lookalike of the S&P 500 index fund. It is majorly used by investors to invest in largely publicly traded companies. The annual return of this mutual fund for the past 5 years is 18.5%, which is why it is a good option for investors that want to diversify their income portfolio. Also worth noting is that the expense ratio of the FXAIX mutual fund is 0.015%.

4. Vanguard Windsor II Fund Investor Shares (VWNFX)

As an investor, if you are looking for a mutual fund that you can use to invest in value-priced publicly traded companies, then make the VWNFX a must-pick. The annual of this fund for over the past 5 years is 15.3%, while its expense ratio is 0.34%.

5. Shelton NASDAQ-100 Index Direct (NASDX)

This is a mutual fund that sometimes tries to replicate the financial performance of the Nasdaq-100 index.  It is important for potential investors to note that the historical performance of this mutual fund for the past 5 years is 27.9%.

6. Fidelity NASDAQ Composite Index (FNCMX)

This is a mutual fund that can be used by investors to track the performance of the entire Nasdaq stock exchange which contains over 3,000 stocks. This is a mutual fund that has had an annual of 20.8 percent over the last 10 years and an expense ratio of 0.29%. If you are looking for a long-term investment mutual fund, then make the Fidelity NASDAQ composite Index a must-pick.

7. Hartford Core Equity R5 (HGITX)

If you want to invest in publicly traded companies that are growth-based or value priced, then the Hartford Core Equity R5 should be your go-to mutual fund. For the past 10 years, they have constantly grown annual return at 17.3 percent.

Factors That Should Affect Your Choice Of Mutual Funds

Factors That Should Affect Your Choice Of Mutual Funds
Choosing the best mutual fund depends largely on what the investor needs. Here are some key factors that should be put into consideration when looking for the best mutual funds:

  • When Do You Plan To Access The Money

The more time you take on the money, the greater the risk you take in investing stock funds. If you are looking forward to getting your returns in the next year, or two, then you might want to reduce the risk with money market funds or a bond.

  • Do You Have A Specific Gap In Your Income Portfolio?

If you want to invest in mutual funds, you might need a greater balance in your portfolio. You need to consider whether you have allocated funds towards bonds and need some stocks to balance out your returns. Are your stock investments, USA-based or foreign-based?

Different Types of Mutual Funds To Invest In

If you want to invest in mutual funds, it is important to note that they come in different types of investments. Here are the different types of mutual funds that you can invest in.

i. Stock Mutual Funds

Stock Mutual funds are funds that are own stocks exclusively. This is why they are very volatile, with lower overall returns and higher overall returns.

ii. Bond Mutual Funds

A bond mutual fund is a type of mutual fund that owns bonds exclusively. Just like stock mutual funds, they are also volatile because they are likely to deliver lower returns or higher returns over time.

iii. Money Market Mutual Funds

These are funds that can be used to own safe securities such as very short-term debt, or cash. It is important for investors to note that this type of mutual fund is safer than stock-based or bond-based mutual funds.

iv. Balanced Mutual Funds

These are mutual funds that offer low volatility for investors. They can be used by investors to diversify their income portfolio when they use it to invest in stocks, bonds or money market instruments. The low volatility that the balanced mutual funds offer comes in exchange for lower overall returns.

v. Target-Date Mutual Funds

This is a type of mutual fund that is popular with 401(k) accounts. The Target-date mutual funds can be used to invest stocks, money market instruments, and bonds. When an investor picks when they want to access their money, the target date fund will choose investments that match that time period, reducing risk as the investor nears the target date.

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