Mutual Fund Basics

Investing in individual common stocks can be an expensive endeavor. Commissions to the broker on every buy and sell can add up over time. Many investors instead choose to invest in mutual funds based on the misconception that mutual funds do not charge commissions. In reality, mutual funds, even funds that are no-load funds, can be costly to buy, sell or simply hold.

Preferred Stock

Preferred stock is a hybrid security, meaning it is not a stock or a bond. Preferred stock is an equity security that shows ownership in a company. In most cases, preferred stock is offered to the public by the issuing company to acquire another company, or to improve capital and expansion at a time when stockholders and the public are not buying common stock. Unlike common stock, preferred stock does not fluctuate very much in price.