Convertible Securities

What are convertible securities no load mutual funds, and what do they offer to an investor? These are mutual funds which have a majority of investments in preferred stocks and bonds, and these securities have the option of being converted into a different form, such as common stocks and bonds at a price that is set. Convertible securities offer higher income because they are preferred shares, and these shares will appreciate more as well. It is possible to find reverse convertible securities as well. Securities which convert to another form are becoming a popular investment for investors who want to see higher income and more capital appreciation from investments. There is a set number of shares and a price which is set in advance, and these are used to determine the exchange. Because convertible securities are preferred investments there are benefits that these holdings have which common holdings do not. In the future the investor may choose to convert the securities into more shares of a lower holding. Careful evaluation of any no load mutual funds which offer these securities is important, to find the best no load funds which fit well with the investment goals and strategies being used.

Convertible securities no load mutual funds offer advantages over individual holdings. Mutual funds combine the investment pool from many investors, and then use these funds to invest. This method will allow an investor to make one fund decision, and this one decision covers a number of investments that the fund holds. The best no load funds all follow a specific criteria, and each individual will have a different idea of what investments and funds are ideal for them. What may be perfect for some may be a bad choice for others, depending on the risks involved as well as other factors. Finding the best no load mutual funds does not have to be time consuming or extremely difficult. This part is actually easy normally, thanks to the use of the Internet and the many free investment tools available. There are some things to look for in a mutual fund that will identify whether the fund being evaluated is a true no load, or if it is actually a loaded fund that uses deception and hides any load fees. The first step is to look for any fees posted. Determine whether the convertible securities fund charges any load or 12b-1 marketing fees, and if it does than another investment may be a wise choice.

No load mutual funds can legitimately charge a 12b-1 marketing fee without being considered loaded, within reason. The marketing fee should never be more than one fourth of one percent of the net assets for the fund. If the fee is more than this there is a high possibility that this fee involves hidden load charges as well. The best no load funds will not charge any marketing fee at all. Choosing no load also means making investment decisions without any professional help. Load fees are basically sales commissions, and these are paid to the broker to help the investor find the right fund for their specific investment needs and goals. Most individuals do not need this professional help, and can evaluate and choose the funds which are right on their own. A load fee can be five percent of the investment capital or more, and this amount can really add up over time and eat into the value of the holdings. Convertible securities and reverse convertible securities have advantages and disadvantages involved, and a smart investor will thoroughly evaluate and compare no load mutual funds to find the right one for them.