GHARE SHIKHIE ANNTARGHAT RACHNATMAK MULYANKAN NA NAMUNA NA PRASHNO
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Unit investment trusts (UITs) are issued to the public only once when they are created. UITs generally have a limited life span, established at creation. Investors can redeem shares directly with the fund at any time (similar to an open-end fund) or wait to redeem them upon the trust’s termination. Less commonly, they can sell their shares in the open market.
There are a variety of fees that may be associated with mutual funds. Some funds come with transaction charges for buys and sells or commissions known as loads. And there are funds that charge a redemption fee if you sell shares you’ve only owned for a short time. Investors also pay ongoing expenses to cover the cost of operating the fund; this includes investment advisory fees (paying the fund manager and the research staff), as well as transaction costs associated with buying and selling securities within the fund. When evaluating a fund, remember that fees play a factor and may potentially detract from a fund’s performance over time. All Fidelity funds can be bought or sold with no transaction fees when you buy them through Fidelity.
Mutual funds may be classified by their principal investments, as described in the prospectus and investment objective. The four main categories of funds are money market funds, bond or fixed-income funds, stock or equity funds, and hybrid funds. Within these categories, funds may be sub-classified by investment objective, investment approach, or specific focus.
GHARE SHIKHIE ANNTARGHAT RACHNATMAK MULYANKAN NA NAMUNA NA PRASHNO
STD 1 TO 5 TEACHERS USEFULL
Hybrid funds may be structured as funds of funds, meaning that they invest by buying shares in other mutual funds that invest in securities. Many funds of funds invest in affiliated funds (meaning mutual funds managed by the same fund sponsor), although some invest in unaffiliated funds (i.e., managed by other fund sponsors) or some combination of the two.
One thing that can lead to diworsification is the fact that a fund’s purpose or makeup isn’t always clear. Fund advertisements can guide investors down the wrong path. The Securities and Exchange Commission (SEC) requires that funds have at least 80% of assets in the particular type of investment implied in their names. How the remaining assets are invested is up to the fund manager. However, the different categories that qualify for the required 80% of the assets may be vague and wide-ranging. A fund can, therefore, manipulate prospective investors via its title. A fund that focuses narrowly on Congolese stocks, for example, could be sold with a far-ranging title like “International High-Tech Fund.”
Mutual funds provide investors with professional management, but it comes at a cost—those expense ratios mentioned earlier. These fees reduce the fund’s overall payout, and they’re assessed to mutual fund investors regardless of the performance of the fund. As you can imagine, in years when the fund doesn’t make money, these fees only magnify losses. Creating, distributing, and running a mutual fund is an expensive undertaking. Everything from the portfolio manager’s salary to the investors’ quarterly statements cost money. Those expenses are passed on to the investors. Since fees vary widely from fund to fund, failing to pay attention to the fees can have negative long-term consequences. Actively managed funds incur transaction costs that accumulate over each year. Remember, every dollar spent on fees is a dollar that is not invested to grow over time.
GHARE SHIKHIE ANNTARGHAT RACHNATMAK MULYANKAN NA NAMUNA NA PRASHNO
STD 1 TO 5 TEACHERS USEFULL
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