Instructions

• 1). Examine your account statement. Determine what type of mutual fund you own, "closed-end" or "open-end." Depending on the quality of statement at your financial services firm, this may be simple or more difficult. "Closed-end" funds trade on a stock exchange and have a stock symbol, usually three letters in length; oftentimes brokerage houses list these under the "equity" portion of your account statement. "Open-end" mutual funds do not trade on the stock exchange and usually carry a five-letter symbol; generally, they will be listed under a separate "mutual fund" section on your statement.
  
  
• 2). Find a new mutual fund. Whether you use a broker or your own financial acumen, search for a fund that will succeed where your previous fund failed. For example, if you are unhappy with the high expenses of your current mutual fund, seek out a list of funds with low overall expenses; if you are looking to diversify your overall account, find funds that invest where your current fund does not.
  
  
• 3). Research funds in the same family. Switching mutual funds into another fund in the same fund family offers a number of benefits as opposed to buying and selling. Usually, you can exchange your fund into another in the same family without incurring any additional sales charges; additionally, the fund company will usually consider your exchange as having the original purchase date in terms of any future sales charges. For example, if your fund charges you a sales charge if you sell the fund within five years, and you exchange into a different fund in the same family after four years, you still are relieved of this sales charge obligation after holding the fund for just one more year.
  
  
• 4). Sell or exchange your fund, and buy the new one. If you own "closed-end" funds, you can buy or sell them on the open market just like a stock. If you own "open-end" funds, you must sell or exchange them through your financial services firm. Remember that if you are switching "closed-end" funds, you must pay a commission to sell your original fund, and another commission to buy your new fund. The commission structure for "open-end" funds can vary widely---some funds are "no-load" and do not charge any fees to either buy or sell, but some funds charge fees to sell, to buy, and even to exchange in some cases. Verify all of the costs involved before you proceed with your transaction.