would have to carefully consider the following before making an investment option:
1. Do I have enough knowledge of mutual funds to make investment in one? Where can I get these information? Is it readily accessible? Is the source trustworthy?
2. Is there any investment advisor who can help me make these decisions or inform me about the different types of risk involved with mutual funds? Can I trust the investment broker? Will I get updated information?
3. What is my level of risk? If very low, then I am better off with purchasing a certificate of deposit that is federally insured. If I can afford to take risks, then I could invest in either a growth / income mutual fund. Is the market volatile or steady?
4. When do I need the money? Certificates of deposits are available for investment for different periods ranging from one-day, two-days, a week, a month, 3-months, a year, 2-years and so on…. If I need the money sooner, then I would buy a certificate of deposit. For a mutual fund, the redemption period may not be sooner, or the fees on early redemption may reduce any money generated.
5. What are the fees charges by investment broker or firm? Will the earnings be more substantial in a mutual fund be more substantial than a CD. Or, will the fees and charges erode any earnings in mutual fund?
6. What is my taxation profile? If in high tax bracket, I maybe better off with buying dividends mutual fund.
7. Finally, I would review the interest rates. What are the interest rates offered in a GIC and what is the assumed interest on the mutual fund. If all situations being equal, then I would invest in th ...