I wrote an article entitled, "How to Choose a Stock Mutual Fund," that's been posted here. It details the factors you need to consider when choosing a mutual fund. Give it a read and tell me what you think.
Here are the highlights:
- Invest the bulk of your investment funds in index funds, most likely an S&P 500 index fund
- Choose no load, low fee mutual funds
- Dollar-cost average
- Invest in funds that have low initial and subsequent investment so that you put your money to work sooner rather than later
- Most importantly, with actively-managed funds, choose superior fund managers
And over time, the stock market (think S&P 500) has returned over 10 percent per year (dividends included).