無憂投資
無憂投資
Open-end fund
The term Mutual fund is the common name for an open-end investment company. Being open-ended means that at the end of every day, the investment management company sponsoring the fund issues new shares to investors and buys back shares from investors wishing to leave the fund.
Mutual Funds may be legally structured as corporations or business trusts but in either instance are classed as open-end investment companies by the SEC.
Other funds have a limited number of shares; these are either closed-end fund or unit investment trusts neither of which are mutual funds.
Exchange-traded funds
A relatively new innovation, the exchange traded fund (ETF), is often formulated as an open-end investment company. The way ETFs work combines characteristics of both mutual funds and closed-end funds. An ETF usually tracks a stock index (see Index funds). Shares are only created or redeemed by institutional investors in large blocks (typically 50,000 shares). Investors typically purchase shares in small quantities through brokers at a small premium or discount to the net asset value through which the institutional investor makes their profit. Because the institutional investors handle the majority of trades, ETFs are more efficient than traditional mutual funds and therefore tend to have lower expenses. ETFs are traded throughout the day on a stock exchange, just like closed-end funds.
Equity funds
Equity funds, which mainly consist of stock
investments, are the most common type of mutual fund. Equity funds hold 50 percent of total funds invested in mutual funds in the United States. Oftentimes equity funds focus investments on particular strategies and certain types of companies.
Capitalization
Some mutual funds focus investments on companies of particular size ranges, with size measured by their market capitalization. The size ranges include micro-cap , small-cap, mid-cap, and large-cap. Fund managers and other investment professionals have varying definitions of these market cap ranges. The following ranges are used by Russell Indexes include:
Russell Microcap Index ($54.8 - 539.5 million)
Russell 2000 - small cap ($182.6 million - 1.8 billion)
Russell Midcap Index ($1.8 - 13.7 billion)
Russell 1000 - large cap ($1.8 - 386.9 billion)
Growth vs. value
Another division is between growth funds, which invest in stocks of companies that have the potential for large capital gains, versus value funds, which concentrate on stocks that are undervalued. Growth stocks typically have a potential for larger return, however such investments also bear larger risks. Growth funds tend not to pay regular dividends. Sector funds focus on specific industry sectors, such as biotechnology or energy. Income funds tend to be more conservative investments, with a focus on stocks that pay dividends. A balanced fund may use a combination of strategies, typically including some investment in bonds, to stay more conservative when it comes to risk, yet aim for some growth.
Index funds versus active management
An index fund maintains investments in companies that are part of major stock indices, such as the S&P 500, while an actively-managed fund attempts to outperform a relevant index through superior stock-picking techniques. The assets of an index fund are managed to closely approximate the performance of a particular published index. Since the composition of an index changes infrequently, an index fund manager makes fewer trades, on average, than does an active fund manager. For this reason, index funds generally have lower trading expenses than actively-managed funds, and typically incur fewer short-term capital gains which must be passed on to shareholders. Additionally, index funds do not incur expenses to pay for selection of individual stocks (proprietary selection techniques, research, etc.) and deciding when to buy, hold or sell individual holdings. Instead, a fairly simple computer model can identify whatever changes are needed to bring the fund back into agreement with its target index.
The performance of an actively-managed fund largely depends on the investment decisions of its manager. Statistically, for every investor who outperforms the market, there is one who underperforms. Among those who outperform their index before expenses, though, many end up underperforming after expenses. Before expenses, a well-run index fund should be average. By minimizing the impact of expenses, index funds should be able to perform better than average.
Certain empirical evidence seems to illustrate that mutual funds do not beat the market and actively managed mutual funds under-perform other broad-based portfolios with similar characteristics. finds that nearly 1,500 U.S.A. mutual funds under-performed the market in approximately half the years between 1962 and 1992. Moreover, funds that performed well in the past are not able to beat the market again in the future (shown by Jensen, 1968; Grimblatt and Titman, 1989. However, as quantitative finance is in its early stages of development more accurate studies are required to reach a decisive conclusion.
Bond funds
Bond funds account for 18% of mutual fund assets. Types of bond funds include term funds, which have a fixed set of time (short, medium, long-term) before they mature. Municipal bond funds generally have lower returns, but have tax advantages and lower risk. High-yield bond funds invest in corporate bonds, including high-yield or junk-bonds. With the potential for high yield, these bonds also come with greater risk.
Money market funds
Money market funds hold 26% of mutual fund assets in the United States.Money market funds entail the least risk, as well as lower rates of return. Unlike certificate of deposits (CDs), assets in money market funds are liquid and redeemable at any time. The interest rate quoted by money market funds is known as the 7 Day SEC Yield.
Hedge funds
Hedge funds in the United States are pooled investment funds with loose SEC regulation, and should not be confused with mutual funds. Certain hedge funds are required to register with SEC as investment advisers under the Investment Advisers Act. The Act does not require an adviser to follow or avoid any particular investment strategies, nor does it require or prohibit specific investments. Hedge funds typically charge a fee greater than 1%, plus a "performance fee" of 20% of a hedge fund's profits. There may be a "lock-up" period, during which an investor cannot cash in shares.
