Invest Right for College

    For my college tuition, I am setting up my investment portfolio which in seven years, will help pay for my education. Since this is over a long period of time, my investment strategy can be riskier than it would be over a shorter period of time. I have selected a balanced mutual fund and a global stock fund to help me with the savings I am setting aside for college.

    The balanced mutual fund has a wide variety of stocks and bonds. The bonds and stocks are both equally balanced. The balanced mutual fund invests in different industries selling stocks, and also invests in different industries selling bonds. The wide variety in a balanced fund offers a great amount of diversification. This creates beneficial additions to my portfolio. The global stock fund on the other hand, invests in companies positioned all over the world, and may not be synchronized with the domestic stocks. Since the stocks of these foreign companies are located in countries all around the globe, they can be affected by different factors that do not affect domestic stocks in the United States. So while the stocks might be falling in the United States, they might be rising around the world. This fund also has an amount of diversification, too.

    The two funds are similar in many ways, but have some differences. They both invest in a wide array of different stocks. Also the balanced mutual funds and global stock funds have a lot of diversification. The balanced mutual fund in the United States invests in both stocks and bonds in this country. On the other hand, the Global Stock Fund only invests in stocks around the world. Also the currency is different. In the United States we use dollars, but other countries use their currencies. Recently most foreign currencies are doing very well, and the United States dollar is not. So the income in the global fund would grow even more. Unlike the global fund, the balanced mutual fund will help me save money because it invests in a wide range of different industries and companies in the United States. This increases my chances for profits in my college savings portfolio.

    The selections of these two funds will give me the best chance to meet my college tuition needs. Leaving my money in these two funds for seven to eleven years, will give me the returns on my investments needed to save for a good college education.