Best Mutual Funds for Short-Term Investors with Low Risk Tolerance

Investors knew this year would be different. But lately, they've been getting a lesson in just how different it is shaping up to be. With market volatility on the rise, it's more important than ever for investors with a short time horizon and low risk tolerance to choose the right mutual funds for their portfolio.

Retirement income funds are a type of mutual fund that provide retirees with a stable source of income plus the potential for growth. For Ann, as an investor with a short time horizon and low risk tolerance, these funds could be a good option to consider. By investing in retirement income funds, Ann can ensure a steady stream of income while also protecting her investment from market fluctuations.

Vanguard offers more than 80 exchange-traded funds (ETFs) tailored to a broad range of investment strategies and financial goals. Our listing of the best mutual funds sticks to U.S. and international equity funds, plus one allocation fund and one short-term bond fund. Vanguard's diverse range of ETFs could provide Ann with the flexibility she needs to build a well-rounded portfolio that aligns with her investment goals.

Our listing of the best exchange-traded funds is designed for the needs of investors who want low-fee, strategic ETFs that are appropriate for short-term investments with low risk tolerance. Ann can benefit from these strategic ETFs by gaining exposure to a mix of assets while keeping costs low and reducing overall risk in her portfolio.

This post explains why I switched my investment portfolio from a two-ETF solution (VCN/VXC) to the new Vanguard All Equity ETF (VEQT): Vanguard's All Equity ETF could be a suitable option for Ann as it provides broad exposure to global equities while maintaining a balanced approach to risk management.