Clown Magician

Mutual Funds For Dummies

Clown Magician

I wouldn't call myself a dummy. But, between me and my husband, I was the ignorant one when it came to mutual funds. He handles our investments, and he always keeps me informed, but I never really cared to know more than I had to. When I came across this book I felt compelled to read it, and I'm glad I did. Eric Tyson really knows his stuff, but he presents the information in a humorous and down-to-earth manner. He does a good job of relating the complicated world of finance to concepts a layman can understand.

The best thing about Mutual Funds For Dummies is the approach the author takes. Tyson gives you his opinions and explains many of the reasons that stock brokers and financial planners may be inclined to steer you wrong. I felt that this book was very empowering because it gives solid arguments against some of the things salesman will say to you to ensure your business with them.


"Brokers work on commission, so they can and will sell you only load funds. They may even try to hoodwink you into believing that they can do financial planning for you. Don't believe it." (p. 114)


The first section of Mutual Funds For Dummies discusses the how's and why's of mutual funds. Tyson explains investments from the ground up, and then builds on that information. So, by the end of the book you could talk with the financial "geeks" and nobody would be the wiser. Tyson also gives good information about how to pick great mutual funds. He explains all of the things you need to look for—operating expenses, comparing performance numbers, fund managers and warning signs for loser funds. Then he goes through a prospectus page by page and explains what's important and then points out the stuff you don't need to worry about. This will be a great reference for years to come at our house.

The second section deals with building a portfolio of mutual funds. Asset allocation, taxes and investment strategies are discussed. Then Tyson explains each different type of mutual fund—money market, bond funds, and stock funds. My favorite part about this section were "Eric's Picks". He gives you lists of the best funds in each category and includes the 1-800 numbers so you can call the company today! His picks are a varied group, so that you can find one that's for your situation. Just about every list has at least one index fund that he recommends.