Go-Go Fund
Candlefocus EditorDespite the risks inherent in the investment strategies, go-go funds proved popular, peaking in the late 1960s and early 1970s. Fund managers lured investors with the promise of double-digit market returns, which had previously been unheard of in the mutual fund industry. A bull market of the period only perpetuated excitement and popularity of these funds, allowing them to quickly become some of the largest and most potent global financial instruments. Following the stock market crashes of the 1970s, however, the funds lost much of their popularity.
Today, investors can still purchase go-go funds if they're so inclined; they just have to decide if the risks in these funds are worthwhile given their higher potential returns. Before investing, potential go-go fund investors should understand the fund's strategies and research which stocks the fund holds. Knowing this will provide investors the information necessary to determine how much risk they're wish to take on and how comfortable they should feel investing in the specific go-go fund. No matter the level of risk tolerance, investors should understand the volatility of the go-go fund and its inherent risks before investing.