100 Years of Economic Innovation
As we mark the 100th anniversary of mutual funds, it's important to recognize their role in driving economic growth, not just in America but worldwide. Investment tools like mutual funds, along with ETFs and other regulated investment funds, channel trillions of dollars toward new and established businesses transforming ideas into successes and strengthening prosperity. Here are just a few ways investment funds help advance our economy:
- Growing capital: Investment funds have helped make America the world’s economic leader while supporting commercial breakthroughs globally, by pooling money from investors to build diversified portfolios with stocks, bonds, and other securities. This process allows businesses to finance expansions and research and development. It also enables governments to fund critical infrastructure and services.
- Fostering Innovation: Investment funds serve as catalysts for growth, helping small and large companies alike access capital that drives innovation and commercial breakthroughs.
- Creating jobs: By helping the flow of capital to businesses and governments, investment funds create jobs. Increased funding allows companies to expand their workforce, invest in infrastructure, and bolster overall economic activity.
- Financial Security: Investment funds provide access to a variety of investment opportunities, empowering everyday Americans to participate in the success of global companies and work toward long-term financial objectives such as education, homeownership, and retirement.
- Driving real economic growth: Through their potential to generate positive returns, investment funds help households grow their wealth, fostering consumer confidence and spending—a phenomenon known as the wealth effect—that strengthens real economic growth.
- Creating market efficiencies: Investment funds support market efficiencies by directing capital based on practical risk/reward assessments, promoting efficient resource allocation and economic productivity.
While some policymakers advocate for sensible reforms to modernize and strengthen these funds for the benefit of investors, others propose drastic changes that could jeopardize the interests of investors like you. Policymakers must understand the pivotal role investment funds play in the economy as they consider any new laws.
Investment funds have driven economic progress and facilitated commercial breakthroughs worldwide, enriching the lives of millions and providing growth opportunities for companies. Given the appropriate policy framework, investment funds can help propel even greater achievements over the next 100 years.
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