Equity funds can make your firm wealthy if you pick the right ones. Instead of spending hours researching individual stocks, why not leave that up to the equity funds managers? After all, it is their livelihood.

The equity funds managers' objectives have a long-term strategy when it comes to equity funds. Namely, they seek to invest in companies that have the potential of capital appreciation and yielding high returns for their investors. Equity funds are also known as stock funds. Here are some types of equity funds you should consider:

1. Add growth funds to your equity funds investments.

2. Spread out part of your equity funds into index funds.

3. Diversify some of your equity funds into sector funds.

Action Steps
The best contacts and resources to help you get it done

Consider adding growth funds to equity funds investments

If you're looking for long-term growth and can withstand stock price volatility, buy equity funds that specialize in growth companies. Growth companies are likely to reinvest most, if not all, of their profits into research and development. Equity funds brokerage firms like growth companies because they produce higher yields on capital gains.

I recommend: Oppenheimer Funds provide excellent equity funds services. Its growth fund, Oppenheimer Capital Appreciation Fund, invests in growth companies, such as Research in Motion and Google. Thornburg Investment Management has been in the equity funds investments business since 1982. Its Thornburg Core Growth Fund invests in growth companies that it believes will produce significant earnings and revenues.

Allocate some of your equity funds into index funds

Do you want to capitalize on the growth of stocks that make up the indexes, such as Dow Jones or NASDAQ? Consider investing in index funds. As an equity funds investor, you can buy and sell these stock mutual funds that reflect the indexes. One reason why an equity funds investor tends to like index funds is that they have lower management costs than other mutual funds. This is due to the fact that the turnover rate of securities is low.

I recommend: iShares provides equity funds services that focus on index funds. The equity funds company started the NYSE Composite Index Fund in 2004 and has shares in large companies, such as IBM, AT&T, and other well-known companies. Fidelity Investments also invests in equity funds. Its Spartan 500 Index Fund has low management costs.

Include sector funds in your equity funds

If your specialty is in technology or telecommunications, then you should consider investing in sector funds. Sector funds focus on a particular industry. An equity funds broker likes these funds because they can yield significant returns.

I recommend: Select Sector SPDR has several sector funds, including Technology SPDR. This fund invests in software, telecommunications, and semiconductor companies. The T. Rowe Price Media and Telecommunications fund focuses on telecommunications, technology, and media companies.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Ton invest in equity funds smartly, consider consulting investment research companies, such as Morningstar, for equity funds help. Morningstar is a great resource because it ranks the top-performing equity funds.