Mutual funds pool the money of many investors who share similar objectives, creating diversified portfolios under professional management. A mutual fund may invest its shareholders’ money in stocks, bonds, or both. Some mutual-fund companies provide families of funds, allowing you to switch your money from one fund to another as your investment objectives change.

Many funds allow an initial investment as low as $250-$1,000 and can provide convenient reinvestment of dividends and capital gains. Many also allow you to take advantage of a proven investment discipline called dollar-cost averaging—investing the same number of dollars at regular intervals.

We offer a variety of stock, bond, and balanced (stock-and-bond) mutual funds from several companies—including municipal-bond funds designed to yield tax-exempt income. We also offer unit investment trusts (UITs), which provide diversified portfolios of municipal, public debt, and equity securities.

Ten Good Reasons to Invest in Mutual Funds:

1. The expertise and research capabilities of full-time investment professionals to manage the securities in the funds.
2. Portfolio diversification among a variety of securities. This broad exposure helps reduce your risk of loss from problems with a single issuer.
3. A broad choice of investment objectives, from conservative to aggressive, which enables investors to own one fund or a mix of funds with varying objectives and styles.
4. Transaction costs are reduced by well-managed funds buying and selling large blocks of shares on behalf of thousands of investors at once, versus buying and selling individual securities on your own.
5. Ready liquidity of shares, which are immediately convertible into cash at the current net asset value, and ease of exchange within a fund family as investment conditions and personal circumstances change. Investment returns and principal value fluctuate so that an investors shares when redeemed may be worth more or less than their original cost
6. High recognition value because mutual funds are considered the most popular and mainstream method of investing for individuals and institutional investors.
7. You can target growth opportunities with specialty or sector funds, where investors can choose specific industries and the fund manager can pick the stocks. Sector and/or specialty funds may have higher risks since they tend to be less diversified.
8. Published records of performance and close monitoring, with fund prices published daily in major newspapers.
9. Regular account statements detailing dividends and capital gains reinvested in additional shares.
10. Low minimum investments and the ability to dollar-cost average—an effective strategy that can help you make the most of your investment dollars.

Mutual Fund Pricing Options

Mutual funds offer a flexible selection of pricing options: Class A, Class B, and Class C shares as well as no-load funds and institutional shares.

No-Load Shares: While “loaded” funds, i.e., A, B, and C shares, are distributed through the brokerage industry who pay commissions to advisors for helping them gather assets, “no-load” fund shares are marketed directly to the investor, who as a result does not pay any commissions to purchase the funds. Today, with the advent of investment advisory services, no-load shares are available to investors when they establish an investment advisory account with an advisor who receives a “fee” for managing your assets as opposed to a commission for buying and selling assets. There are no commissions paid when purchasing or selling a no-load fund. Typically, the operating expense for a true no-load fund is less, often times, much less than the operating expenses of an A, B, or C share class mutual fund.

Institutional Shares: Institutional Shares are typically reserved for very wealthy investors, including large institutions, pension plans, and endowment funds. Institutional shares historically offer their shares at the lowest operating expense possible, to provide a “volume discount” to those investors who can meet the minimum investment requirements, which can be as high as $1MM, $5MM and even $10MM. With the advent of advisory services accounts, many fund company’s  institutional shares became available to investors who alone would fail to meet the minimum requirements. However, when purchased in volume by the investment advisory firm, these shares are often available. At Lane Bridgers, our FundSource program invests almost exclusively in institutional shares.

Class A shares are sold with an up-front sales charge, which declines as the investment amount increases. For many shareholders - especially those with significant account balances - this remains the most cost-effective way to own mutual fund shares.

Class B shares have no up-front sales charge but have higher expenses than Class A shares. You may pay a fee if you sell shares within six years of purchase. These shares convert to Class A shares after eight years, with lower expenses and no redemption fee.

Class C shares do not have an up-front sales charge, but investors are subject to a 1% contingent deferred sales charge on shares sold within 12 months of purchase. In addition, investors pay higher expenses than on Class A shares.

Speak with your Financial Advisor to see which type of shares would be right for you and your investment goals. If you decide that a retail brokerage account best meets your needs, you will be limited to the A, B & C Share classes. However, if you choose an investment advisory account, your portfolio may include institutional funds, no-load funds, and “load-waived” A shares, meaning you are purchasing A Share mutual funds at Net Asset Value (NAV) and not paying the “up-front” commission you would pay in a brokerage account.

Mutual funds are sold by prospectus. The prospectus contains detailed information about the particular mutual fund's goals, objectives, investment style, charges, and expenses. A prospectus for a particular mutual fund can be obtained from Lane Bridgers and should be read carefully before you invest.

Investors should realize that return and principal value of shares in a mutual fund, other than a money-market mutual fund, will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Investors should also remember that funds whose investments are concentrated in a specific sector may be subject to a higher degree of market risk than funds whose investments are diversified.

Money-market mutual funds seek to preserve the value of a shareholder's investment at $1.00 per share, but it is possible to lose money by investing in a money-market mutual fund.