Customize - Urban Dictionary Store

Pro Customization

Create unique products with your own words and definitions

Preview

Personalize Your Design

Your Word

Your Definition

Typically a Mutual Fund is an investment fund aimed at individual investors sponsored by an investment (or "mutual fund") house like Fidelity, Vanguard or T. Rowe Price. Each fund holds a "market basket" of stocks or bonds and individual investors buy into the fund by buying a share at "Net Asset Value," which is the total worth of the fund's holdings, calculated every day, divided by the number of shares outstanding. In other words, a mutual fund whose portfolio (value of all holdings) is worth a [million dollars] that has a hundred thousand shares outstanding will value those shares at ten dollars apiece. A typical stock-based mutual fund can earn its investors money in three ways: the dividends and capital gains that stocks pay out, and possible [appreciation] of the fund value per share.

For an individual investor, the advantage of [owning] a mutual fund is that s/he achieves diversity -- mutual funds own more than fifty stocks, on average -- that could not be achieved by buying a typical hundred shares of stock in only a few [corporations]. The disadvantages of such funds are that the "load" (sales commission) involved in buying or selling such funds can be [considerable], and all funds incur some sort of service fees; that's how the investment house earns its money. Also, no "equity" or stock-based investment is guaranteed.

Text fits

Menu

Pro Customization

Preview

Personalize Your Design

Shopping Assistant