As a former Mutual Fund Investment Adviser, I have talked to thousands of people all across North America about Mutual Funds. Mutual Funds can be very complicated and overwhelming. This can prevent many people from investing in them, which will prevent their investment portfolios from reaching their full potential. Having a little bit of knowledge about these complex investments will ensure that you are not discouraged, and will also help you make sound investment decisions.

Here are the top 10 questions that I was asked, along with my responses:

1. What is a Mutual Fund?
A Mutual Fund is a pool of money that is used to invest in the stock market. For a person to properly invest in the stock market, they need a large amount of money that can be properly dispersed among many stocks to reduce risk and to take advantage of an average increase that takes place over a period of time. Most people cannot afford this, so Mutual Funds were created to pool their money together into one fund that is professionally managed for greater growth.

2. What is the MER, how does it affect my return?
MER stands for the term Management Expense Ratio. In short, this is the amount that is paid to the person that manages and invests the money in the pool. This is usually a percentage between 1 to 3 percent. Generally speaking, the more work the manager has to do, the more the MER will be.

3. Does the MER come out of my money?
The MER does not come out of your money. The percentage paid to the Fund Manager is taken off of the performance of the fund. For example, if you have a fund that makes 12% and the MER is 2%, then the performance of the fund would be listed at 10%.

4. Why should I invest in Mutual Funds?
Mutual Funds will increase your chances of making money while decreasing you chances of losing money. A good example of the decreased risk is comparing it to losing your wallet. If you have all of your money in one wallet and you lose it, all of your money is gone. If you have money in two wallets and you lose one of them, you still have half of your money left.

5. What are the different types of funds, which one's are better?
There are three different types of Mutual Funds, savings funds, income funds, and growth funds. Savings funds are the lowest risk funds. The main goal of these funds is to make modest interest while preserving the investment. These funds are great for people who are investing for the short term, or have very little

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