Types of Mutual Funds cntd.

4. Balanced Funds Balanced funds invest in a mix of equities and fixed income securities – typically in a 40% equity 60% fixed income ratio. The aim of these funds is to generate higher returns but also mitigate risk through fixed income securities. 5. Index Funds Index funds aim to track the performance of a specific index. For example, the S&P or TSX. Index funds follow the index and go up when the index goes up and goes down when the index goes down. Index funds are popular as they typically require a lower management fee compared to other funds (due to the manager not needing to do as much research). 6. Specialty Funds Specialty funds focus on a very small part of a market such as energy, telecommunications, healthcare, industrials, etc.