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Top mutual funds and your best investment in 2015

2019-04-16 Investing No comment

I remember that when the top mutual fund and some investors made the best investment, the return rate was 144% in one year. The same fund will not be the top mutual fund in 2015 because it does not exist today, even though similar funds. And none of them can be the best investment in 2015. This is what you need to know.

Top-level mutual funds in any given year may also be the best investment for investors, as most investors are not actively involved in the market. Funding is the realm of ordinary investors, of course. They are designed for those who don't have the time, experience or desire to screen thousands of alternatives in the investment arena. At the same time, you must be aware of some things when you deposit funds into these professional money managers.

When the economy and corporate sales and profits are healthy and growing, the top mutual fund [the fund with the highest total return per year] is likely to be a fund that invests in stocks [also known as stocks]. How do I get a 144% return in one year? First of all, this is a good year for the market. Second, they invested in positive growth stocks. Third, they use financial leverage. Why do I suggest a similar one that is unlikely to be your best investment in 2015, what is financial leverage?

Financial leverage is a catalyst for the Great Depression and the 2008 financial crisis. Financial leverage: You increase your return by borrowing money so you can invest more. Example: If you have $100,000, you can "guarantee" a stock worth $200,000 and owe your broker $100,000. This 2 to 1 leak doubles your return because you can buy twice as much inventory. Bad news: You can also lose twice as much, plus interest. In other words, this past top mutual fund may be the best investment, but it poses a great risk to investors.

The real bad news is that large companies can and have adopted higher leverage. When the market takes significant steps against them, their cards [the debt they have to bear] will collapse. In extreme cases, this could create a financial crisis.

Now let's take a look at the other two factors of the top mutual fund I mentioned in 2015: the stock market and growth stocks. In good [up] market growth, stocks and funds that invest in them tend to perform well, but in bad markets [market declines], they tend to be hit harder. Here, one of them may be your best investment in 2015, especially if it uses financial leverage. Or it may be one of the biggest losers – just like the one I mentioned originally is the last year.

The economic outlook and overall stock market trends have had a major impact on the best mutual funds in 2015 in terms of performance and total return. For example, the stock market has been rising since the end of the 2008 financial crisis. If you are a market tank, where do you find the best investment in the mutual fund world in 2015?

In fact, you have more choices than you think. Some funds focus on areas such as energy and oil stocks or gold stocks or industries. In a bad market, these industries can go upstream. For example, at the time of this writing, the stock market was near its highest point in history. Gold prices have fallen by hundreds of dollars from historical highs and oil prices are falling. One of the departmental funds may be an opportunity and top mutual fund in 2015 and beyond.

Going a step further, what if we really have a really bad stock market in 2015 and beyond? Some funds actually “short” the market and believe that the stock price will fall. Some [called reverse trading funds or exchange-traded funds] do this through a 2 or 3 to 1 financial leverage. Obviously these are risky and not suitable for everyone. But if things are really untied, one of them may be the best investment in 2015, both in terms of performance and total return.

Many investors today do not understand that the situation in the past few years is at least unusual. In the past six years, the stock market has continued to fluctuate slightly, and interest rates have fallen to historical lows. The trend will not last forever. When the above trends change, last year's top mutual funds and best investments will not repeat itself. Remember that the best investment in 2015 and beyond is an investment that fits your risk comfort.

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