文档介绍：Financial Markets and Institutions: Mutual Funds and Hedge Funds
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Suppose you wanted to start savings for retirement, but you can only afford to invest $100 / month. How do you develop a diversified portfolio?
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We study why mutual funds have e so popular, the various types of mutual funds, their regulation, and scandals in the mutual fund industry. Topics include:
The Growth of Mutual Funds
Mutual Fund Structure
Investment Objective Classes
Fee Structure of Investment Funds
Regulation of Mutual Funds
Hedge Funds
Conflicts of Interest in the Mutual Fund Industry
Mutual Funds
A mutual fund is a professionally-managed collective investment vehicle that pools money from many investors by selling them shares and then uses the funds to invest in securities according to prespecified investment objective and approach in its prospectus. Investors, like shareholders of pany, take the loss and gain proportional to their investment.
Advantages of Mutual Funds
Managerial expertise: many investors prefer to rely on professional money managers to select their investments.
Diversification: investors immediately realize the benefits of diversification even for small investments.
Denomination intermediation: investors can participate in equity and debt offerings that, individually, require more capital than they possess.
Liquidity intermediation: investors can quickly convert investments into cash while still allowing the fund to invest for the long term.
Cost advantages: the fund can negotiate lower transaction fees than would be available to the individual investor.
Disadvantages
The disadvantages of mutual funds include:
Fees
Less control over timing of recognition of gains
Less predictable e
No opportunity to customize
Growth of Mutual Funds in .
The first mutual fund similar to the funds of today was introduced in Boston in 1824.
The stock market crash of 1929 set the mutual fund industry back because small investors avoided stocks a