Mutual Fund Myths | Things you should know about Mutual Funds | Mutual Funds India Info

Mutual Fund Myth #1:
Closed-end funds are often confused with, and mistakenly called, mutual funds.
Closed-end funds, ETFs and mutual funds are types of investment companies.

Mutual Fund Myth #2:
"Short-term capital gains distributions can be offset with capital losses -- both short-term and long-term."Short-term capital gains distributions cannot be offset with other capital losses (long or short) and offers no economic value to mutual fund shareholders.Saying that ETFs are cheaper than mutual funds is like saying that mutual funds outperform ETFs (or vice versa).

Some ETFs are cheaper than mutual funds and some ETFs are more expensive than mutual funds. Vanguard offers actively-managed funds and index funds. They also offer exchange-traded funds. A mutual fund load is a fee charged when an investor makes a transaction in fund shares. Loads may be charged upon purchase of fund shares (front-end load) or upon sale of fund shares (back-end loads). These loads are paid to the broker for selling the fund