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The Power of Compounding Interest
 


Mutual fund
A mutual fund is a pool of securities professionally managed to meet a common objective.
instant diversification, low minimum, professional management for small sums, ideal for dollar-cost-averaging.


Money market fund
A mutual fund investing in short term money market instruments,
such as certificates of deposit, treasury bills and commercial paper.
The fundís net asset value is usually $1 a share, and its interest rate goes up or down.
Most money market funds offer check-writing privileges.



Municipal bond fund
A mutual fund that invests in municipal bonds.
Municipal bond funds are popular with investors who want to reduce their tax burden, because interest on municipal obligations is often free of federal income taxes and/or state and local income taxes.
 
     
     

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