First Investors Mutual Funds

About Mutual Funds

Investing in mutual funds is an excellent way to start building your investment portfolio. Depending on their objectives, mutual funds invest in a wide range of securities, such as equities, bonds and money market instruments. By investing in a large, diversified basket of securities, mutual funds offer the benefit of built-in diversification.

When you invest in a mutual fund, you are pooling your money with that of other investors with similar goals and allowing a professional management team to make the underlying investment decisions.

There are two main categories of First Investors mutual funds: core and non-core. Core funds are those that should be considered as part of a foundation for a complete investment program. They are generally considered to carry a moderate level of risk and are well diversified. Examples of our core funds include the First Investors Growth & Income Fund and the First Investors Investment Grade Fund.

First Investors also offers non-core funds that carry a higher degree of risk. Non-core funds can be useful to add diversification to a portfolio, or to achieve a specific investment objective. For example, the First Investors International Fund, a non-core fund, can be used to give an investor exposure to opportunities outside the United States. First Investors registered representatives can help you decide on an appropriate mix of core and non-core funds for your investment portfolio.

Mutual funds can also be classified by the type of investment vehicle they employ.

Equity Funds

Investing mainly in the stocks of companies of various sizes, these funds usually have the highest potential rate of return, as well as the highest level of risk. There are many types of equity (or stock) funds, just as there are many types of stocks. First Investors offers equity funds that focus on global stocks, blue-chip companies, small caps, mid caps, large caps, as well as a mix of equities and bonds.

Income Funds

These funds invest mainly in corporate debt securities. Generally, these funds have a lower level of risk than equity funds, but a higher level of risk than money market funds. Investors concerned with receiving income from their investment may want to consider a taxable bond fund as one of the foundations of a diversified portfolio. The principal risks associated with taxable bond funds are interest rate fluctuations and corporate default. Different funds have varying levels of risk, the highest levels being associated with those funds that invest in high yield bonds, which have a higher potential rate of return, as well as a greater risk of default.

Municipal Bond Funds

These funds primarily invest in securities issued by municipalities to finance public projects such as bridges, schools and highways. The primary benefit of investing in municipal bonds is their tax-exempt status. Depending on where investors live, they may be able to invest in municipal bond funds that are “triple tax exempt” (exempt from local, state and government taxes). However, these funds are subject to interest rate risk and market risk. Therefore, the values of the funds' shares will fluctuate.

Money Market Funds