History of Mutual Funds

Author: First-Mutual-Fund Date: Wed, 25 Nov 2009 08:49:27

For many investors, the choice of possible investments can be overwhelming. There are stocks, bonds, commodities, securities and lots of other choices. One of the most popular choices is mutual funds. These diverse and complex investments have become one of the most popular ways to invest and Americans have been taking part in mutual fund investing for many, many years. pivotal role in trying to protect potential investors from getting ripped off. The SEC requires that companies file their financial information with them, so that investors can see which companies are healthy and are ready to grow, and which companies to stay away from.
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Open-End Fund, Closed Fund, Mutual Fund

Author: First-Mutual-Fund Date: Wed, 18 Nov 2009 08:44:09

Open-End Fund
The majority of mutual funds are open-end. By continuously selling and buying back fund shares, these funds provide investors with a very useful and convenient investing vehicle.
Closed Fund
Generally, current shareholders in a closed mutual fund are permitted to continue investing in the fund, but sometimes they are also be precluded from making additional investments.
Mutual Fund
One of the main advantages of mutual funds is that they give small investors access to professionally managed, diversified portfolios of equities, bonds and other securities, which would be quite difficult (if not impossible) to create with a small amount of capital.
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Closed-End Funds

Author: First-Mutual-Fund Date: Wed, 18 Nov 2009 08:39:27

Closed-end funds – like open-end or mutual funds – establish a portfolio of securities and issue shares of the portfolio to the investing public. And as with mutual funds, each share represents an undivided interest in the portfolio of securities. Unlike mutual funds, however, closed-end funds typically issue shares to the public only once. They do not continually sell new shares or redeem already-outstanding ones. Therefore, the number of closed-end fund shares outstanding (the company's capitalization) tends to remain, for the most part, fixed.
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Disadvantages and Advantages of Mutual Funds

Author: First-Mutual-Fund Date: Wed, 18 Nov 2009 08:35:30

The popularity of mutual funds can be attributed to the numerous advantages that they afford investors, some of which are listed below:
Diversification - Most financial professional believe that diversification is one of the best ways to enhance a portfolio's risk-adjusted return.
Low minimum investment - Mutual funds make it possible for investors with very little cash to own an undivided interest in a diversified portfolio.
Professional management - Mutual funds give investors access to professional managers whose required minimum account size would otherwise put their services out of the reach of many.
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Diversification

Author: First-Mutual-Fund Date: Wed, 28 Oct 2009 08:31:01

Diversification is the idea of spreading out your money across many different types of investments. When one investment is down another might be up. Choosing to diversify your investment holdings reduces your risk tremendously.

The most basic level of diversification is to buy multiple stocks rather than just one stock. Mutual funds are set up to buy many stocks (even hundreds or thousands). Beyond that, you can diversify even more by purchasing different kinds of stocks, then adding bonds, then international, and so on.
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Definition

Author: First-Mutual-Fund Date: Wed, 28 Oct 2009 08:27:00

An open-ended fund operated by an investment company which raises money from shareholders and invests in a group of assets, in accordance with a stated set of objectives. mutual funds raise money by selling shares of the fund to the public, much like any other type of company can sell stock in itself to the public. Mutual funds then take the money they receive from the sale of their shares (along with any money made from previous investments) and use it to purchase various investment vehicles, such as stocks, bonds and money market instruments. More -->

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