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Although increases in stock market value do not correlate with increases in GDP, it is the case that large magnitude drops in stock market value portend recessions and decreases in GDP. In any case, investors generally pull out of index and total stock market funds as yields on these investments fall dramatically. These investors are seeking replacement financial products with no load that can duplicate the rise of stocks during good years. A high yield mutual fund of comparable risk is not always available but let us consider some possibilities.

The first place to look is a brokerage that offers mutual funds in the first place. More importantly, the brokerage should be a no load, low fee broker that deal primarily with mutual funds. The fees are kept low because management does not acquire many fees ostensibly paid for their skill in choosing stocks. The reason why people shy away from high fee mutual funds is that very often there is no value in the fees. That is, paid managers do not seem to be particularly good at picking winning stocks for inclusion in the mutual fund portfolio.

Another possibility that is related to equity investments is the ETF or exchange traded fund. They are baskets of stocks much like mutual funds but are bought and sold on the exchange rather than being handled exclusively by a single brokerage. Their advantage lies in their treatment as stock-like instruments, bought and sold all day with few minimums restrictions. Regular mutual funds are bought and accounted together, and usually have high minimums unless they are part of a retirement account.

There are a few other possibilities for savvy investors other than high yield mutual funds in trying financial years.

Checking and savings accounts infrequently offer the best available yields encouraging investors to turn elsewhere. Undoubtedly investors will encounter the money market account that are similar to typical bank accounts but offer more lucrative rates. Investors who are concerned about the reliability of online banks should be comforted as long as the banking institution is licensed, it is insured by the FDIC in the event of a serious collapse. Money market accounts must not be confused with a money market fund which invests in a portfolio of such instruments, and accordingly are not federal government insured.

Investors may benefit from GNMA mutual funds. The partially-government owned organization Ginnie Mae is responsible for financing the housing loans of a safer subset of home buyers. In the time of the financial crisis perpetrated at least partly by the property meltdown of 2007, Freddie Mac and Fannie Mae fell victim to hemmorhaging drops in revenue forcing a declaration from the Treasury to prevent investor panic. GNMA funds discovered that it was in a much better condition, showing little sign of being in need of help. SEC rules still demand that GNMA-titled funds to contain more than 4/5ths of assets in GNMA-related securities.

Giant companies and governments must take out loans so as to execute day-to-day activities until sufficient tax is amassed to repay the borrowed money. Such a large scale financing has no hope of being done using a typical bank, but must be self-financed via the selling of bonds which are promises of payment. Many buy into bonds for what up till now has been a highly trustworthy promise of return and absence of risk.Bond funds come as no load index funds where the fees are low.

This and other topics on high yield mutual funds are accessible to all. Additional resources supplied for index funds no load can be read here.