Signs of Improvement? Mutual Funds Up 17% in Past Three Months

By: Tim Ciesco Email
By: Tim Ciesco Email

Financial experts say it's another sign the economy may be improving -- after starting the year in the red, some investors are already back on pace to make gains this year.

They say overall, stocks and financial markets are improving and continue to show signs of growth, but one real standout in all of it is mutual funds.

A mutual fund is a large pool of money managed by a financial professional who invests it in a number of stocks, bonds, and other securities.

Experts say the average fund has gained 17% in the past three months -- a much higher rate than most individual stocks. When most of those funds were reporting losses in the first quarter of 2009, they say that push has already put them at a 6.5% gain for the year.

And based on current market trends, they say those gains should only increase.

"The recession hopefully will be ending the latter part of this year and the first part of next year," said Larry Jones, Branch Manager of Financial West Group. "The stock markets with mutual funds being an integral part of that, they will probably benefit from that and lead the way out [of the recession] four to six months in advance."

In spite of those gains, experts say mutual funds are still down more than 30% from where they were in Fall 2007, when the market was at its peak.

But they say mutual funds are still a smart, sound investment now as long you're willing to pay the fees they charge to manage your money.

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