How to Choose a Mutual Fund

Investors wanting to build a portfolio will have no shortage of mutual funds at their disposal. And that's one of the biggest problems in choosing just one or two.

A person selecting one of five apples
(Image credit: Getty Images)

Mutual funds are a quick, easy and affordable way to build a diversified portfolio. Because you can purchase mutual funds by the dollar, as opposed to by the share, you can invest as much or as little as you'd like (provided you meet the fund's investment minimum, which sometimes is as low as zero).

Honestly, the hardest part is figuring out how to choose the right mutual fund for you.

With 9,340 mutual funds on offer as of the end of 2021, just narrowing your investment universe to one or a couple of mutual funds leaves you with a lot of sorting to do. To choose the right mutual fund for your portfolio, you need to evaluate your goals, then explore attributes such as risk, fees and fund size to narrow your options to the best of the bunch.

Read on as we show you how to choose a mutual fund.

Coryanne Hicks
Contributing Writer,

Coryanne Hicks is an investing and personal finance journalist specializing in women and millennial investors. Previously, she was a fully licensed financial professional at Fidelity Investments where she helped clients make more informed financial decisions every day. She has ghostwritten financial guidebooks for industry professionals and even a personal memoir. She is passionate about improving financial literacy and believes a little education can go a long way. You can connect with her on Twitter (opens in new tab), Instagram (opens in new tab) or her website, (opens in new tab).