Mutual Fund Basics
This type of investment pools money from many investors to buy stocks or bonds.
A Mutual fund
investment objective of preservation of capital, maximum current income and the maintenance of liquidity.
Money Market
A company or firm responsible for the operation of the mutual fund.
Management Company
Updates to a shareholder's non-financial information on his/her account.
Maintenance
The ability to sell, or redeem, all or part of their investments at any time.
Liquidity
The value per share of a mutual fund calculated daily.
NAV (Net Asset Value)
These Funds have the potential to provide regular, ongoing income.
Bond Funds
Someone who owns Shares in a mutual fund
Shareholder
A purchase of mutual fund shares.
Subscription/Contribution
This policy is to spread the fund's investments across a number of different securities.
Diversification
This represents a shareholder's proportionate ownership of a portfolio and any income it generates.
Shares
Generated from the interest or income earned on the securities in the fund's portfolio
Dividends
An individual through which shareholders can receive investment advice and purchase investments like mutual funds.
Broker
Moving shares from one fund to another fund, within the same account
Exchange
The shareholder can move, or exchange, his/her investment from one fund to another to take advantage of different investment objectives and investment opportunities.
Flexibility
The process of pricing Mutual funds once, nightly after the 4 p.m. Eastern Standard Time when the stock market closes.
Daily Pricing
Investors who have long-term financial goals, such as a secure retirement or a child's education, may consider an investment in
Stock or Equity Funds
a bank, trust company, or corporation which is contracted by the management company to maintain records, service shareholder accounts, distribute dividends and capital gains, and perform tax reporting.
Transfer Agent
Selling a shareholder's mutual fund shares.
Redemption
Mutual funds are an easy investment to buy.
Accessibility
where investors purchase mutual fund shares from vs Stocks and Bonds that are Purchased on the secondary market.
The Fund itself or Broker who represents the fund
When a shareholder sells shares in a mutual fund for a profit.
Personal Capital Gains
An individual/group hired by the management company to manage the portfolio. They ensure that the portfolio meets or exceed investment objectives.
Portfolio Manager
The shares are moved from one shareholder's account to a different shareholder's account within the same fund.
Transfer
Mutual Funds make this kind of financial expertise accessible to everyone.
Professional Management