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Canadian mutual fund interest is compounded daily?
AnswerSince there are no guarantees associated with investing in a mutual fund, the interest does not work the same as say a GIC. The mutual fund is subject to the day to day activities of the stock market, increasing or decreasing in value on a day to day basis.
What is the role of mutual fund?
The role of a mutual fund is to provide avenues of investment for the normal investor who does not have the expertise or the time to have a direct investment in the stock marketbut at the same time wants to gain exposure to the stock market for its high return potential.
What is the importance of mutual fund rating?
The importance of the mutual fund rating is for investors to measure a fund's historical risk-adjusted performance over different time frames compared with funds that are in the same category. It is important to investors so they can feel a little safer in where they are deciding to invest their money.
What are the disadvantages of mutual funds?
Disadvantages of mutual funds compared to owning securities outright - 1. Mutual funds charge you an annual maintenance fee as a % of assets, and in some cases a sales load too. Holding individual securities there is no charge once the broker fees are paid. 2. When you buy shares in a mutual fund, you don't officially own the securities held by the mutual fund. While this has little practical significance, I suppose in theory there could be problems of some sort. The risk of anything happening is small and shouldn't keep you from buying mutual funds for this reason alone. 3. Sometimes a mutual fund's investment philosophy changes over time without you being aware of it. You may buy a fund thinking they are a diversified fund and then two years, its drifted toward certain sectors or certain parts of the market. By the same token, sometimes a mutual fund starts participating in derivative markets and increasing its leverage, which introduces additional risk you should be aware of. 4. Changes in mutual fund management can bring changes too - sometimes they aren't as savvy (or as lucky) as prior management.
Is fidelity 401K FDIC insured?
Per the FDIC website: http://www.fdic.gov/consumers/consumer/information/fdiciorn.htmlWhat Is Not Insured?Increasingly, institutions are also offering consumers a broad array of investment products that are not deposits, such as mutual funds, annuities, life insurance policies, stocks and bonds. Unlike the traditional checking or savings account, however, these non-deposit investment products are not insured by the FDIC. Mutual FundsInvestors sometimes favor mutual funds over other investments, perhaps because they hold promise of a higher rate of return than say, CDs. And with a mutual fund, such as a stock fund, your risk - the risk of a company going bankrupt, resulting in the loss of investors' funds - is more spread out because you own a piece of a lot of companies instead of a portion of a single enterprise. A mutual fund manager may invest the fund's money in either a variety of industries or several companies in the same industry. Or your funds may be invested in a money market mutual fund, which may invest in short-term CDs or securities such as Treasury bills and government or corporate bonds. Do not confuse a money market mutual fund with an FDIC-insured money market deposit account (described earlier), which earns interest in an amount determined by, and paid by, the financial institution where your funds are deposited. You can - and should - obtain definitive information about any mutual fund before investing in it by reading a prospectus, which is available at the bank or brokerage where you plan to do business. The key point to remember when you contemplate purchasing mutual funds, stocks, bonds or other investment products, whether at a bank or elsewhere, is: Funds so invested are NOT deposits, and therefore are NOT insured by the FDIC - or any other agency of the federal government.
Are open-end funds the same as mutual funds?
Often referred to as the mutual fund industry, the open-end fund industry comprises about 95 percent of the mutual fund market
What is a mutual fund's objective?
The objective of a mutual fund is to pool in money from investors and use it to invest in investment vehicles thereby trying to generate profit for the investors and use the same to profit the company that runs the Mutual fund.
Canadian mutual fund interest is compounded daily?
AnswerSince there are no guarantees associated with investing in a mutual fund, the interest does not work the same as say a GIC. The mutual fund is subject to the day to day activities of the stock market, increasing or decreasing in value on a day to day basis.
Is a Mutual Fund Right for You?
The mutual fund is a bundle of investments that are taken together for the purposes of dealing out interest related profits to investors. Mutual funds are known in the common knowledge as a "safe" type of investment, primarily because of the low maintenance required by the investor to keep the mutual fund. However, this common definition of the mutual fund has been shattered by the recent events in the market; namely, the Great Recession and the US debt crisis, both of which rocked the market so much as to shake mutual funds from their safe perch. A mutual fund must be researched the same as any other investment, only with a mutual fund, one must research the investment team.
What is the role of mutual fund?
The role of a mutual fund is to provide avenues of investment for the normal investor who does not have the expertise or the time to have a direct investment in the stock marketbut at the same time wants to gain exposure to the stock market for its high return potential.
What is the importance of mutual fund rating?
The importance of the mutual fund rating is for investors to measure a fund's historical risk-adjusted performance over different time frames compared with funds that are in the same category. It is important to investors so they can feel a little safer in where they are deciding to invest their money.
What are the disadvantages of mutual funds?
Disadvantages of mutual funds compared to owning securities outright - 1. Mutual funds charge you an annual maintenance fee as a % of assets, and in some cases a sales load too. Holding individual securities there is no charge once the broker fees are paid. 2. When you buy shares in a mutual fund, you don't officially own the securities held by the mutual fund. While this has little practical significance, I suppose in theory there could be problems of some sort. The risk of anything happening is small and shouldn't keep you from buying mutual funds for this reason alone. 3. Sometimes a mutual fund's investment philosophy changes over time without you being aware of it. You may buy a fund thinking they are a diversified fund and then two years, its drifted toward certain sectors or certain parts of the market. By the same token, sometimes a mutual fund starts participating in derivative markets and increasing its leverage, which introduces additional risk you should be aware of. 4. Changes in mutual fund management can bring changes too - sometimes they aren't as savvy (or as lucky) as prior management.
What is mutual Fund?
A mutual fund, also referred to as an open-end fund, is an investment company that spreads its money across a diversified portfolio of securities -- including stocks, bonds, or money market instruments. Shareholders who invest in a fund each own a representative portion of those investments, less any expenses charged by the fund. Mutual fund investors make money either by receiving dividends and interest from their investments, or by the rise in value of the securities. Dividends, interest and profits from the sale of any securities (capital gains) are passed on to the shareholders in the form of distributions. And shareholders generally are allowed to sell (redeem) their shares at any time for the closing market price of the fund on that day why invest in mutual fund? There are a variety of reasons why investors might choose mutual funds over other investments, such as individual stocks and bonds. The number one reason is diversity, which can both increase your potential returns and decrease your overall risk. Mutual funds allow an investor to spread out his or her money across as few as a handful to as many as several thousand companies at one time. Funds can be especially advantageous for small investors who would be forced to pay enormous transaction fees if they bought the securities individually, and for investors who either don't have the time to research their own investments or who don't trust their own investment expertise. (For more on asset allocation, see "Build Your Own Mutual Fund Portfolio" tool). That said, mutual funds aren't necessarily low-cost investments. Many of them charge one-time "load fees" to new purchasers that can exceed 5 percent of the investment, and all mutual funds take on average take 1.3 percent of assets a year for operating expenses, expressed as the "expense ratio." As a result, "index" funds (see below) have surged in popularity in recent years because, on average, they provide a much lower expense ratio than managed funds. Also an index fund's risk is limited to that of the benchmark index that it tracks, such as the Standard & Poor's 500. Finally, the rapid emergence of 401(k) plans as the retirement vehicle of choice for millions of Americans means that mutual funds are here to stay. Professional management can be both a benefit and a liability of actively managed mutual funds. Several studies show that, over time, the average, actively managed fund has underperformed the overall stock market. Still, by picking funds with good long-term track records, managers you trust and low expenses, investors can build a portfolio with the potential for steady, long-term returns that match their own investment goals and tolerance for risk. Liquidity -- the ability to readily access your money -- is another benefit of mutual funds. Funds can be sold on any business day at that day's closing price – or at the following day’s close if the sell order is placed after the market closes. The price per share at any given time is known as the net asset value, or NAV, which is the current market value of all the fund's assets, minus liabilities, divided by the total number of outstanding shares. As new investors buy into a fund, the number of outstanding shares goes up, as does the market value of assets, but the NAV remains the same. By sandeep sawant
Can you please tell me how do we select a mutual fund?
The first step is to find out the objectives of investment.The objectives of investment in mutual fund will be low risk or high risk. If the objectives of the investement are same as the investors, then one can go on to the next step. It is very important to evaluate the past performance of the mutual fund. Through this evaluation an investor can get an idea of performance of the mutual fund. There are lot of online trade portals that provide the information like Reliance mutual fund,ICICI,HDFC.
How is mutual fund share pricing publicized?
They release their prices the same day for publication in the next day's newspapers. Daily prices of mutual fund shares can also be obtained directly from the fund's offices or Web sites of commercial venders
Money market funds?
Money market funds are funds that invest in money market instruments. Also known as principal stability funds, seek to limit exposure to losses due to credit, market and liquidity risks They invest in the highest quality debt products thereby minimizing chances of losses. They would not invest more than 5% in the same debt issuer to ensure that there is minimal chances of losses. There are two types of Money market funds. They are: * Institutional money fund & * Retail money fund
Why should you invest in the mutual fund when you can directly invest in the same instrument?
As all the other instruments in equity and debts even mutual funds carry risk, but mutual funds are considered a better option because ,you investments will be managed by the professional managers who are in the better positions and they can spread your investment across various sectors around the market .Thus we can say that mutual funds are best option of investment in which few mutual funds like reliance mutual funds and DSP mutual funds are good players in the market .
