Sales toads are brokers commissions

Sales loads are commissions paid to brokers (who often call themselves something other than brokers) who sell mutual funds. Typically, commissions range from 4 percent to as high as 8.5 percent of the amount you invest. Note Some funds sold at companies such as Fidelity and Dreyfus charge a commission even though you purchase the fund directly from them without a broker's involvement. I recommend that you avoid these funds as well. (I'll make sure that you do when I recommend specific funds...

Investment Newsletter Halt of Shame

The following sections reveal some of the many examples of the really heavy stuff that gets shoveled by some of these folks to sell you on their investment newsletters. All of the following examples are drawn from real-world newsletters. However, I've changed the names to keep you focused on the types of misleading practices that marketing newsletters engage in rather than having you focus on the particular scoundrels behind each of these disreputable newsletters. A veteran newsletter writer,...

BeWare the claims of the stockpicking gurus

It's easy to dismiss the outrageousness of the claims made by someone like Wade Cook. Even if you don't know that Cook has been in trouble with securities regulators and courts for many years now, your common sense tells you that five and six digit returns are well outside the realm of reasonable expectations for stock performance. But what about the more believable performance claims, in the range of 20 and 30 percent, that can so easily dupe an investor into thinking they're true Like the...

Taxable longtern bond funds

Dodge and Cox Income is run by a conservative management team at an old San Francisco investment firm that has been managing money for private accounts since 1930 and running mutual funds since 1931. This fund, which focuses on government securities and high grade corporate debt, is less volatile than most long-term bond funds. The operating expense ratio is 0.5 percent. 2,500 is the minimum initial investment 1,000 for retirement accounts . 800-621-3979. Vanguard Long-Term Corporate is...

Discount Brokers Mutual Fund Supermarkets

For many years, you could only purchase no-load mutual funds directly from mutual fund companies. If you wanted to buy some funds at, say, Vanguard, Fidelity, T. Rowe Price, and USAA, you needed to call these four different companies and request each firm's application. So you ended up filling out four different sets of forms and mailing them with four envelopes, four stamps, and four separate checks. Soon, you received separate statements from each of the four fund companies reporting how your...

Performance discussion

A good annual report is educational and honest. As you can see, Vanguard's is both. The report also does a nice job of providing a historical context for understanding this fund's performance. It explains that bonds normally are less volatile than stocks. The comparative stability of bonds means that a portfolio composed of stocks and bonds, like this one, is less volatile than one made up of just stocks. mguard Wellesley Income Fund earned 20.2 in 1997, a generous return made 1 possible by an...

HouJ This Book Is Different

They present you with some newfangled system that you never figure out how to use without the help of a mainframe computer, several mathematicians, and a Nobel Laureate as your personal consultants. Books that bewilder more than enlighten may be intentional because the author may have another agenda to get you to turn your money over to him to manage or to sell you his newsletter s . These writers with an agenda may imply and sometimes say that you really...

Publishers Acknowledgments

We're proud of this book please register your comments through our IDG Books Worldwide Online Registration Form located at http my2cents.dummies.com. Some of the people who helped bring this book to market include the following Acquisitions, Editorial, and Media Development Senior Copy Editor Susan Diane Smith Robert Kauffman, Peter Melcher, and Dave Dotson from CCH INCORPORATED Permissions Editor Heather Heath Dismore Editorial Manager Colleen Rainsberger Editorial Assistant Paul E. Kuzmic...