| State Street
Investment Center
INVESTMENTS - BOND MUTUAL
FUNDS
A
mutual fund is an actively managed investment company that pools
money from individuals and institutions who share a common financial
goal. Professional money managers buy a portfolio of securities
they think will help investors achieve their goals. Portfolios typically
consist of stocks, bonds, and money-market instruments or a combination
of these investments.
Bonds are IOUs, or debt, issued by a corporation,
government or government agency in exchange for an investor's loan.
The bond issuer promises to repay the principal amount of the loan
on a certain date, and to make periodic, fixed interest payments
in the interim, which is why they're called "fixed-income"
investments.
A bond's value is determined by the interest
it pays and what's happening in the economy, fluctuating along with
interest rates. When interest rates drop, the value of existing
bonds (paying a higher interest rate) typically rises. When rates
climb, the value of existing bonds usually falls. Changes in the
credit quality of a bond or perceived changes in the financial condition
of the issuer may also impact a bond's value.
There are four attributes of mutual funds that
can work to your advantage:
- Diversification - By pooling investors'
money, a mutual fund may purchase securities from many different
issuers, dramatically reducing the risk that problems or losses
in any one company will hurt the overall portfolio.
- Professional Management - Professional
money managers' decisions to buy and sell are based on extensive
and ongoing research into individual companies, combined with
analysis of economic and market trends.
- Liquidity - You may sell some or all
of your mutual fund shares at any time and receive the current
value of your shares (net asset value), which may be more or less
than their original cost.
- Convenience - Mutual funds offer shareholders
many services that can make investing easier. You can usually:
- Exchange money between funds within the
same fund family as your investment goals change.
- Add to your account electronically, for
example, by transferring a set dollar amount from your savings
or checking account into your mutual fund account each month.
- Redeem shares automatically to help meet
monthly expenses.
- Choose to have distributions of fund
income paid to you by check, transferred into your bank account
or automatically reinvested in more shares of the fund.
- Buy or sell shares by telephone or mail.
Contact a State Street Investment Center representative at (888)
879-2183 or email us
for more detailed information on bond mutual funds.
Investment Products Offered
 Are Not A Deposit
Are Not FDIC-Insured
Are Not Insured
By Any Federal Government Agency
Are Not Guaranteed
By The Bank
May Go Down
In Value
Securities offered through United Heritage Financial Services,
Inc.
707 E. United Heritage Ct, Meridian, ID 83642
Member NASD, SIPC 1-800-657-6351
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