Presentation is loading. Please wait.

Presentation is loading. Please wait.

AI-36904© 2013 American Funds Distributors, Inc. Figures are past results and are not predictive of results in future periods. Investments are not FDIC-insured,

Similar presentations


Presentation on theme: "AI-36904© 2013 American Funds Distributors, Inc. Figures are past results and are not predictive of results in future periods. Investments are not FDIC-insured,"— Presentation transcript:

1 AI-36904© 2013 American Funds Distributors, Inc. Figures are past results and are not predictive of results in future periods. Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value. -A

2 AI-30272© American Funds Distributors, Inc. On the right path 10 questions people often ask about mutual funds V4

3 1 AI What’s the difference between saving and investing? © American Funds Distributors, Inc.V4

4 AI-30280© American Funds Distributors, Inc. Stocks, bonds and cash Growth of $1,000 over past 30 years through 12/31/12 Sources — cash: Ibbotson Associates 30-day U.S. Treasury bill; bonds: Citigroup High-Grade Credit Index; stocks: Standard & Poor’s 500 Composite Index. Growth of a hypothetical investment of $1,000 over the past 30 years through 12/31/12, with interest compounded and distributions reinvested. V4 $3,534 $17,066 $21,666 Cash Bonds Stocks

5 2 AI How should I invest? © American Funds Distributors, Inc.V4

6 AI-34598© American Funds Distributors, Inc. How should I invest?  What are your goals?  What is your risk tolerance?  What are your financial circumstances? V4

7 3 AI Why mutual funds instead of individual stocks? © American Funds Distributors, Inc.V4

8 AI-30276© American Funds Distributors, Inc. Why mutual funds instead of individual stocks?  Experienced investors seek to diversify their holdings  Benefit from investment managers’ research  Mutual funds are well diversified V4

9 4 AI Is mutual fund investing safe? © American Funds Distributors, Inc.V4

10 AI-30278© American Funds Distributors, Inc. Is mutual fund investing safe?  Fluctuations are natural  A highly regulated industry V4

11 5 AI What are the different kinds of mutual funds? © American Funds Distributors, Inc.V4

12 AI-34602© American Funds Distributors, Inc. What are the different kinds of mutual funds?  Stock funds  Bond funds V4

13 6 AI Should I invest overseas? © American Funds Distributors, Inc.V4

14 AI-30288© American Funds Distributors, Inc. Should I invest overseas?  Diversification and opportunity  Additional risks V4

15 AI-34604© American Funds Distributors, Inc. A look at global diversification Adding stocks outside the U.S. has helped reduce volatility, 1/1/83–12/31/12 Results calculated by Thomson. Sources: S&P 500 and MSCI EAFE indexes. MSCI results reflect dividends net of withholding taxes. Volatility is calculated using annualized standard deviation (based on monthly returns), a measure of how returns over time have varied from the mean; a lower number signifies lower volatility. Average annual Standard total return deviation 100% U.S. stocks10.8%15.3 Blend of 65% U.S. and 35% stocks outside the U.S (rebalanced annually) V4

16 7 AI So when is a good time to invest? © American Funds Distributors, Inc.V4

17 AI-30284© American Funds Distributors, Inc. So when is a good time to invest? Growth of $5,000 a year in the S&P 500, 1/1/83 – 12/31/12 *Average annual total return Results calculated by Thomson. Sources: Standard & Poor’s 500 Composite Index, with dividends reinvested. Market high and low dates based on the Dow Jones Industrial Average. V4 $660,313 Worst day (market high) First day of each year Best day (market low) 8.7% a year* $787, % a year* $831, % a year*

18 8 AI-34606© American Funds Distributors, Inc. Why are dividends important? V4

19 AI-34607© American Funds Distributors, Inc. Why are dividends important?  Take dividends in cash  Reinvest dividends and capital gains  Cross-reinvest dividends V4

20 9 AI How much does it cost to invest in mutual funds? © American Funds Distributors, Inc.V4

21 AI-30292© American Funds Distributors, Inc. Mutual fund costs  Sales charge –Also known as a “load” –Up-front –Back-end –Compensates advisers for their services  Contingent deferred sales charge  No-load –Sold directly to the public  Annual operating expenses V4

22 0 1 How do I draw from my investments when the time comes? AI-34609© American Funds Distributors, Inc.V4

23 AI-34610© American Funds Distributors, Inc. How do I draw from my investments?  Withdrawal strategies  Tax-advantaged accounts V4

24 AI Why do so many financial advisers recommend American Funds? © American Funds Distributors, Inc.V4

25 AI-30294© American Funds Distributors, Inc. American Funds Serving mutual fund shareholders for more than 80 years  Consistent approach  Proven system  Superior long-term track record V4

26 AI-36943© American Funds Distributors, Inc. Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing

27 Citigroup Long-Term High-Grade Corporate Bond Index (also known as Citigroup High- Grade Corporate Bond Index) is the corporate component of the Credit Index. It includes those issues from the Credit Index that have at least 10 years to maturity (long term) but excludes asset-backed securities and outside U.S. sovereign/provincial issues. Dow Jones Industrial Average is a price-weighted average of 30 actively traded industrial and service-oriented blue chip stocks. MSCI EAFE® (Europe, Australasia, Far East) Index is a free float-adjusted market capitalization-weighted index that is designed to measure developed equity market results, excluding the United States and Canada. Results reflect net dividends. MSCI USA Index is a free float-adjusted market capitalization-weighted index that is designed to measure the U.S. portion of the world market. Results reflect net dividends. Standard & Poor's 500 Composite Index is a market capitalization-weighted index based on the average weighted results of 500 widely held common stocks. U.S. Treasury Bill Index, as its name implies, represents U.S. Treasury bills, which are short-term debt securities, with maturities of one year or less, issued by the U.S. government. Market indexes are unmanaged and, therefore, have no expenses. AI-44440

28 The return of principal for bond funds and for funds with significant underlying bond holdings is not guaranteed. Fund shares are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings. In addition, there are ongoing fees and expenses associated with owning bond fund shares, which is in contrast to owning individual bonds. Bond prices and a bond fund’s share price will generally move in the opposite direction of interest rates. Unlike mutual fund shares, investments in U.S. Treasuries are guaranteed by the U.S. government as to the payment of principal and interest. Regular investing neither ensures a profit nor protects against loss in a declining market. Unlike mutual fund shares, certificates of deposit (CDs) are FDIC-insured and, if held to maturity, offer a guaranteed return of principal. Unlike fund shares, investments in savings accounts offer a guarantee of principal. Investing outside the United States involves risks such as currency fluctuations, periods of illiquidity and price volatility, as more fully described in the prospectus. These risks may be heightened in connection with investments in developing countries. AI-44440

29 © American Funds Distributors, Inc.-AAI-37355


Download ppt "AI-36904© 2013 American Funds Distributors, Inc. Figures are past results and are not predictive of results in future periods. Investments are not FDIC-insured,"

Similar presentations


Ads by Google