Which investments are right for you?

There are many investments that you can choose in seeking your financial goals -- from individual stocks and bonds to mutual funds.

A mutual fund is an investment that pools the money of numerous investors who have a similar investment goal and invests that money in a number of securities on their behalf. This group of securities (called a portfolio) is managed by a professional money manager who decides which securities to buy and sell in order to track the investment goal of the portfolio.

Mutual funds have long been a popular investment choice with individuals just like you because they offer a number of benefits, regardless of the type of investor that you may be. It is important to note that there is market risk involved when investing in mutual funds, including possible loss of principal. Here's a sampling of some of the benefits that you can enjoy when you invest in mutual funds:

• Professional management
  With a mutual fund, you don't have to monitor the markets and the economy or worry about which specific assets to buy and sell. Professional managers with extensive knowledge and specific expertise make the investment decisions.
  
  
• Diversification
  Mutual funds spread investors' money among many different securities, far more than most individuals would own themselves. Diversification can help reduce risk over time. However, it is important to note that diversification does not assure a profit or protect against loss in a declining market.
  
  
• Low investment minimums
  Mutual funds typically have low minimum investment requirements for both initial and subsequent investments, making them affordable to virtually every type of investor.
  
  
• Record keeping and regular statements
  Mutual funds keep track of your investments and provide a confirmation statement following each transaction. As a shareowner in any State Farm Mutual Fund®, you will receive a quarterly consolidated account statement in addition to semi-annual and annual reports.

State Farm VP Management Corp Risk/Important Disclosures. State Farm Mutual Funds Prospectus. The State Farm College Savings Plan Enrollment Handbook (PDF 390 KB) .

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