An open-end(ed) fund is a collective investment scheme A collective investment scheme is a way of investing money with others to participate in a wider range of investments than feasible for most individual investors, and to share the costs and benefits of doing so which can issue and redeem shares at any time. An investor will generally purchase shares in the fund directly from the fund itself rather than from the existing shareholders. It contrasts with a closed-end fund A closed-end fund, or closed-ended fund is a collective investment scheme with a limited number of shares, which typically issues all the shares it will issue at the outset, with such shares usually being tradeable between investors thereafter.

Open-ended funds are available in most developed countries, though terminology and operating rules vary. U.S. mutual funds A mutual fund is a professionally managed type of collective investment scheme that pools money from many investors and invests typically in investment securities . The mutual fund will have a fund manager that trades (buys and sells) the fund's investments in accordance with the fund's investment objective. In the U.S., a fund registered with the, UK unit trusts Found in Australia, Ireland, the Isle of Man, Jersey, New Zealand, South Africa, Singapore, and the UK, unit trusts offer access to a wide range of securities and OEICs An ICVC or Investment Company with Variable Capital is a type of open-ended collective investment formed as a corporation under the Open-Ended Investment Companies Regulations of the United Kingdom. They are also known as OEICs from these regulations. The terms ICVC and OEIC are used interchangeably with different investment managers favouring one, European SICAVs A SICAV is an open-ended collective investment scheme common in Western Europe especially Luxembourg, Switzerland, Italy, Spain, Belgium and France. SICAV is an acronym for société d'investissement à capital variable which can be translated as 'investment company with variable capital', hedge funds A hedge fund is an investment fund open to a limited range of investors that undertakes a wider range of investment and trading activities than traditional long-only investment funds, and that, in general, pays a performance fee to its investment manager. Every hedge fund has its own investment strategy that determines the type of investments and and exchange-traded funds An exchange-traded fund (also known as Exchange-Traded Product (ETP)) is an investment fund traded on stock exchanges, much like stocks. An ETF holds assets such as stocks or bonds and trades at approximately the same price as the net asset value of its underlying assets over the course of the trading day. Most ETFs track an index, such as the S& are all examples of open-ended funds.

The price at which shares in an open-ended fund are issued or can be redeemed will vary in proportion to the net asset value Net asset value is a term used to describe the value of an entity's assets less the value of its liabilities. The term is most commonly used in relation to open-ended or mutual funds due to the fact that shares of such funds are redeemed at their net asset value. However, the term may also be used as a synonym for book value or the equity value of of the fund, and therefore directly reflects the fund's performance.

Contents

Fees

There may be a percentage charge levied on purchase or sale of shares—in this case, the fund is a "load fund"; if there are no such charges levied, the fund is "no-load Mutual fund fees and expenses are charges that may be incurred by investors who hold mutual funds. Running a mutual fund involves costs, including shareholder transaction costs, investment advisory fees, and marketing and distribution expenses. Funds pass along these costs to investors in a number of ways". However, brokerages may charge commissions for the purchase of even no-load funds, and there might also be other fees associated with no-load funds, such as yearly maintenance fees in IRA An Individual Retirement Arrangement is a retirement plan account that provides some tax advantages for retirement savings in the United States accounts and redemption fees designed to discourage shareholders from jumping in and out of funds in an attempt at market timing.

Active management

Most open-end funds are actively managed, meaning that a portfolio manager picks the securities to buy, although index funds An index fund or index tracker is a collective investment scheme that aims to replicate the movements of an index of a specific financial market, or a set of rules of ownership that are held constant, regardless of market conditions are now growing in popularity. Index funds are open-end funds that attempt to replicate an index, such as the S&P 500, and therefore do not allow the manager to actively choose securities to buy. These fees are commonly referred to as 12b-1 fees in U.S.

Net asset value

The price per share, or NAV (net asset value Net asset value is a term used to describe the value of an entity's assets less the value of its liabilities. The term is most commonly used in relation to open-ended or mutual funds due to the fact that shares of such funds are redeemed at their net asset value. However, the term may also be used as a synonym for book value or the equity value of), is calculated by dividing the fund's assets minus liabilities by the number of shares outstanding. This is usually calculated at the end of every trading day.

Hedge funds

Hedge funds A hedge fund is an investment fund open to a limited range of investors that undertakes a wider range of investment and trading activities than traditional long-only investment funds, and that, in general, pays a performance fee to its investment manager. Every hedge fund has its own investment strategy that determines the type of investments and are typically open-ended and actively managed. However, their NAV is typically calculated monthly.

Examples

U.S. ^ b. English is the de facto language of American government and the sole language spoken at home by 80% of Americans age five and older. Spanish is the second most commonly spoken language mutual funds A mutual fund is a professionally managed type of collective investment scheme that pools money from many investors and invests typically in investment securities . The mutual fund will have a fund manager that trades (buys and sells) the fund's investments in accordance with the fund's investment objective. In the U.S., a fund registered with the:

See also

Investment management Investment management is the professional management of various securities and assets (e.g., real estate), to meet specified investment goals for the benefit of the investors. Investors may be institutions (insurance companies, pension funds, corporations etc.) or private investors (both directly via investment contracts and more commonly via
Collective investment scheme structures A collective investment scheme is a way of investing money with others to participate in a wider range of investments than feasible for most individual investors, and to share the costs and benefits of doing so Common contractual fund A Common Contractual Fund is a new collective investment scheme structure in Ireland introduced by the European Communities UCITS Regulations, 2003 · Fond commun de placement Fonds commun de placement translates to "investment funds" or "mutual funds", and are open-ended collective investment funds based that are neither trust or company law based. They are similar to Common contractual funds in Ireland · Investment trust A Investment trust is a form of collective investment found mostly in the United Kingdom. Investment trusts are closed-end funds and are constituted as public limited companies · Unit trust Found in Australia, Ireland, the Isle of Man, Jersey, New Zealand, South Africa, Singapore, and the UK, unit trusts offer access to a wide range of securities · Mutual fund A mutual fund is a professionally managed type of collective investment scheme that pools money from many investors and invests typically in investment securities . The mutual fund will have a fund manager that trades (buys and sells) the fund's investments in accordance with the fund's investment objective. In the U.S., a fund registered with the · ICVC An ICVC or Investment Company with Variable Capital is a type of open-ended collective investment formed as a corporation under the Open-Ended Investment Companies Regulations of the United Kingdom. They are also known as OEICs from these regulations. The terms ICVC and OEIC are used interchangeably with different investment managers favouring one · SICAV A SICAV is an open-ended collective investment scheme common in Western Europe especially Luxembourg, Switzerland, Italy, Spain, Belgium and France. SICAV is an acronym for société d'investissement à capital variable which can be translated as 'investment company with variable capital' · Unit Investment Trust A Unit Investment Trust is a US investment company offering a fixed (unmanaged) portfolio of securities having a definite life. UITs are assembled by a sponsor and sold through brokers to investors · Exchange-traded fund An exchange-traded fund (also known as Exchange-Traded Product (ETP)) is an investment fund traded on stock exchanges, much like stocks. An ETF holds assets such as stocks or bonds and trades at approximately the same price as the net asset value of its underlying assets over the course of the trading day. Most ETFs track an index, such as the S& · Offshore fund An offshore fund is a collective investment scheme domiciled in an Offshore Financial Centre, for example British Virgin Islands, Luxembourg, or the Cayman Islands. For the purposes of the Income and Corporation Taxes Act 1988 of the UK, an offshore fund is one which is governed by the Offshore Fund Rules set out in that Act. The vast majority of · Unitised insurance fund Unitised insurance funds or unit-linked insurance funds are a form of collective investment offered through life assurance policies
Investment Styles Active Active management refers to a portfolio management strategy where the manager makes specific investments with the goal of outperforming an investment benchmark index. Investors or mutual funds that do not aspire to create a return in excess of a benchmark index will often invest in an index fund that replicates as closely as possible the or Passive management Passive management is a financial strategy in which a fund manager makes as few portfolio decisions as possible, in order to minimize transaction costs, including the incidence of capital gains tax. One popular method is to mimic the performance of an externally specified index—called 'index funds'. The ethos of an index fund is aptly summed up · Value Value investing is an investment paradigm that derives from the ideas on investment and speculation that Ben Graham & David Dodd began teaching at Columbia Business School in 1928 and subsequently developed in their 1934 text Security Analysis. Although value investing has taken many forms since its inception, it generally involves buying or Growth investing Growth investing is a style of investment strategy. Those who follow this style, known as growth investors, invest in companies that exhibit signs of above-average growth, even if the share price appears expensive in terms of metrics such as price-to-earning or price-to-book ratios. In typical usage, the term "growth investing" contrasts · Hedge fund A hedge fund is an investment fund open to a limited range of investors that undertakes a wider range of investment and trading activities than traditional long-only investment funds, and that, in general, pays a performance fee to its investment manager. Every hedge fund has its own investment strategy that determines the type of investments and · Socially responsible investing Socially responsible investing, also known as socially-conscious or ethical investing, describes an investment strategy which seeks to maximize both financial return and social good · Fund of funds A "Fund Of Funds" is an investment strategy of holding a portfolio of other investment funds rather than investing directly in shares, bonds or other securities. This type of investing is often referred to as multi-manager investment · Manager of managers · Index fund An index fund or index tracker is a collective investment scheme that aims to replicate the movements of an index of a specific financial market, or a set of rules of ownership that are held constant, regardless of market conditions
Theory & Terminology Efficient-market hypothesis In finance, the efficient-market hypothesis asserts that financial markets are "informationally efficient". That is, one cannot consistently achieve returns in excess of average market returns on a risk-adjusted basis, given the information publicly available at the time the investment is made · Net asset value Net asset value is a term used to describe the value of an entity's assets less the value of its liabilities. The term is most commonly used in relation to open-ended or mutual funds due to the fact that shares of such funds are redeemed at their net asset value. However, the term may also be used as a synonym for book value or the equity value of · Open-end fund · Closed-end fund A closed-end fund, or closed-ended fund is a collective investment scheme with a limited number of shares
Related Topics List of asset management firms This is a list of firms that have as their primary business provision of financial asset management / investment management firms, sorted by geographic region · Umbrella fund An umbrella fund is an investment term used to describe a collective investment scheme which is a single legal entity but has several distinct sub-funds which in effect are traded as individual investment funds · UCITS

Categories: Funds

 

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