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Avraham "AY" Rappaport, CLTC
President, Financial Professional
Yaniv "Jay" Natanov
President, Financial Planner
Eli Rappaport
Vice President, Financial Planner
Shlomo Rosenstein
Financial Professional
Ozzie Marizan
Financial Planner
Joseph Greer
Employee Benefits Administrator
Sarah Tutko
Senior Client Support Manager
Premier Financial
6395 Dobbin Road, Suite 102
Columbia, MD 21045
Phone: 240-309-6001
Email: joseph.greer@prudential.com
Website: premierfinancial1.com
March/April 2022
Is a Balanced Fund Right for You?
Balanced funds are mutual funds* that offer a fixed allocation of stocks and bonds. Their investment goal is a mix of capital growth and income with low volatility. You may want to consider balanced funds if you’re near retirement or have a lower tolerance for investment risk.
What’s in the Fund?
Balanced funds typically hold 50% - 70% of their portfolios in stocks and the remainder in investment-grade bonds and cash. They offer a convenient way to achieve diversification** with a single fund. Expenses tend to be low, and investments are periodically rebalanced to retain the fund’s stated asset allocation. Retirees and other investors having a low tolerance for risk may appreciate the moderate growth and steady income provided by these funds.Stocks and Bonds
Balanced funds typically invest in the stocks of large, well-established companies and companies that pay dividends. Because the fund invests across a variety of stock types, the effects of underperforming stocks or market sectors may be minimized.The fund’s fixed-income component consists of investment-grade bonds, such as AAA-rated corporate debt and U.S. Treasuries, that provide income from interest. Stability from fixed-interest securities helps prevent wide fluctuations in the share price of a balanced mutual fund.
Some Disadvantages
Certain strategies, such as tax planning and laddering bonds to take advantage of interest rate changes, aren’t possible with a balanced fund. Funds also may lack exposure to international markets that often perform differently from U.S. markets. Additionally, the fund’s cash component may lower returns.Your financial professional can review the pros and cons of balanced funds to determine if they fit with your goals.
*Investors should carefully consider the investment objectives, risks, charges, and expenses of the fund before investing. Contact the issuing firm to obtain a prospectus, which should be read carefully before investing or sending money. Because mutual fund values fluctuate, redeemed shares may be worth more or less than their original value. Past performance won’t guarantee future results. An investment in mutual funds may result in the loss of principal.
** Diversification cannot eliminate the risk of investment losses. Past performance won’t guarantee future results. An investment in stocks or mutual funds can result in a loss of principal.
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Premier Financial is not affiliated with Prudential Financial. Premier Financial sells insurance products of Prudential Financial's affiliated insurance companies in addition to products of non-affiliated insurance companies. Premier Financial is authorized to sell and service certain insurance products of Prudential Financial companies as well as use this material. Premier Financial and its representatives do not give tax or legal advice. Please consult with your own advisors regarding your particular situation. Offering financial planning and investment advisory services and programs through Pruco Securities, LLC (Pruco), under the marketing name Prudential Financial Planning Services (PFPS), pursuant to a separate client agreement. Offering insurance and securities products and services as a registered representative of Pruco, and an agent of issuing insurance companies. 1-800-778-2255. Sarah Tutko is employed by Eli Rappaport and not The Prudential Insurance Company of America or its subsidiaries.
This newsletter is general educational information provided by a Prudential Financial Professional and is not intended to market or sell any specific products and services, but rather provide general information about the subject matter covered only.
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