How We Invest

Mutual Funds

Mutual funds are a part of our goals-driven investing programs

Just like ETFs, mutual funds give you access to professionally managed portfolios of stocks, bonds and other securities. Mutual funds are a basket of stocks or bonds that typically offer you two advantages over individual securities: diversification and lower costs.

Wealthcare uses mutual funds in our active investment models as they can help with aligning your goals and your investments in a low-cost, tax-efficient.

Why choose mutual funds instead of individual stocks and bonds?

Using mutual funds offers you three key advantages over trading individual stocks and bonds:

Less risk

It’s a convenient way to own a collection of stocks or bonds. And a collection of investments will have less risk than an individual security, like a stock.

If a single stock loses value, it won’t impact your portfolio as much as if you only owned just that stock.

Less work

Mutual fund managers build portfolios by objective, such as growth or income.

Doing so can help you and your advisor choose an investment strategy that aligns with your goals and eliminates the hassle and added risk of picking stocks.

Lower transaction costs

Putting together a portfolio of securities like a mutual fund can require significant transaction costs.

And the higher your transaction costs are, the more return you’ll need just to keep pace with costs.

How Wealthcare’s GDX360 process manages mutual fund portfolios for you

How Wealthcare’s GDX360 process manages mutual fund portfolios for you

Staying abreast of the underlying holdings and objectives of mutual funds is important.

Why?

It helps us in our effort to ensure that the portfolio remains in sync with its intended design and goals. Mutual funds have a variety of characteristics that can impact success relative to your objectives. These include: liquidity, deviations from net asset value, and tracking error relative to the target asset class.

The GDX360 approach to mutual fund selection and monitoring

The GDX360 approach to mutual fund selection and monitoring

Wealthcare monitors your mutual fund selections relative to the universe of mutual funds in an effort to ensure they’re still appropriate for your portfolio.

We do this following key selection criteria: fees, tracking risk, liquidity, and the strength of the mutual fund management company.

If fund characteristics change, and/or new mutual funds pop up, this may lead to changes in your portfolio. We may change mutual fund selections as we seek to enhance your portfolio’s efficiency and keep it on track with your objectives.

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