An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The Fund may impose a fee upon the sale of your shares or may temporarily suspend your ability to sell shares if the Fund’s liquidity falls below required minimums because of market conditions or other factors. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. * You could lose money by investing in a money market fund. While money market funds are considered safer and more conservative, however, they are not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) the way many CDs are.* When you invest in CDs though, you may sacrifice the liquidity generally offered by money market funds. In exchange for that level of safety, money market funds usually provide lower returns than bond funds or individual bonds. Money market funds are conservative investments that offer stability and easy access to your money, ideal for those looking to preserve principal. These include money market funds and short-term CDs (certificates of deposit). However, note that some fixed income investments, like high-yield bonds and certain international bonds, can offer much higher yields, albeit with more risk. These investors may have to accept lower long-term returns, as many bonds-especially high-quality issues-generally don't offer returns as high as stocks over the long term. Investors who are more focused on safety than growth often favor US Treasury or other high-quality bonds, while reducing their exposure to stocks. They can also act as a cushion against the unpredictable ups and downs of the stock market, as they often behave differently than stocks. Most bonds provide regular interest income and are generally considered to be less volatile than stocks. Because stocks are generally more volatile than other types of assets, your investment in a stock could be worth less if and when you decide to sell it. However, this greater potential for growth carries a greater risk, particularly in the short term. Stocks represent the most aggressive portion of your portfolio and provide the opportunity for higher growth over the long term. The 4 primary components of a diversified portfolio Remember, diversification does not ensure a profit or guarantee against loss. Diversification can help mitigate the risk and volatility in your portfolio, potentially reducing the number and severity of stomach-churning ups and downs. This strategy has many different ways of combining assets, but at its root is the simple idea of spreading your portfolio across several asset classes. One way to balance risk and reward in your investment portfolio is to diversify your assets. Conversely, if you invest too aggressively when you're older, you could leave your savings exposed to market volatility, which could erode the value of your assets at an age when you have fewer opportunities to recoup your losses. Invest your retirement nest egg too conservatively at a young age, and you run a twofold risk: (1) that the growth rate of your investments won't keep pace with inflation, and (2) your investments may not grow to an amount you need to retire with. One of the keys to successful investing is learning how to balance your comfort level with risk against your time horizon. This practice is designed to help reduce the volatility of your portfolio over time. Diversification is the practice of spreading your investments around so that your exposure to any one type of asset is limited.
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