Financial Management

Mutual Funds

December 24 , 2008

Introduction

The essay will explore fundamental concepts of mutual funds . The first section includes the definition of mutual funds , brief discussion of the different types of mutual funds . Subsequent sections involve discussion of 5 selected mutual funds investment objectives and providing some examples . Further discussion will delve into the functions of investment bankers and the factors affecting the secondary market of common stocks in the United States

Definition of Mutual Funds

A Mutual Fund is an efficiently administered form of collective investment system

that pools money from different investors . Mutual Fund companies invest it in bonds , short-term money market instruments stocks , and /or other securities . HYPERLINK "http /en .wikipedia .org /wiki /Mutual_fund " \l "cite_note-0 " \o There are various forms of mutual funds . These are Index Funds , Stock Funds , Bond Funds , Money market Funds . In 2007 , it was estimated that table below shows brief information of these forms

TYPE of MUTUAL FUNDS PRIMARY INVESTMENTS

Index Funds Stocks or Bonds based on Selected Indexes such as S

500 Composite Stock Price Index , the Russell 2000 Index or the Wilshire 5000

Stock Funds Stock or Equities

Bond Funds Bonds or other type of Debt Securities

Money Market Funds Invests on government securities , certificates of deposit , commercial of companies , or other highly liquid and low-risk securities Fig . 1 List of Mutual Funds in United States based on Selected Investment Objectives

Some Mutual...