Large-Cap Equity Funds – These funds include stock in companies with market values (or capitalization) greater than $10 billion. Because these tend to be large, established corporations, their stocks generally offer lower risk than stocks from mid- and small-cap companies.
Mid-Cap Funds – These funds include stock in companies with market values (or capitalization) between $2 billion and $10 billion. These stocks are typically more volatile than large-cap stocks but less risky than small-cap stocks.
Small-Cap Funds – These funds include stock in companies with market values (or capitalization) under $2 billion. Small companies can often grow much faster than big companies, but their stocks also tend to be riskier.
International Equity Funds – These funds include stock in companies located outside of the United States. These stocks may trade on either the U.S. or foreign stock exchanges and are generally considered higher-risk investments. Risks include currency fluctuations, political instability, differences in accounting standards and foreign regulations.
Specialty Funds* – These funds are mutual funds investing primarily in the securities of a particular industry, sector, type of security or geographic region. Funds that focus on real estate investing are sensitive to economic and business cycles, changing demographic patterns and government actions.