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Fundamentals of Mutual
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Types of Mutual Funds
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Growth Fund A growth fund is a specific type of mutual fund that focuses its investments in industries and companies where long-term earnings are expected to grow more quickly than the projected earnings of the stock market in general. These funds seek to produce capital gains instead of dividend income. Growth funds trade a degree of investment stability for a higher rate of return. Overall, however, investing in a mutual fund is less volatile than individual stock picking. Mutual funds are comprised of a pool of money amassed from thousands of investors who buy shares in the fund. The fund manager uses the assets to conduct the fund's stated investment program with the benefits being returned to the investors by changes in the net asset value of their shares. (Net asset value is calculated by taking the daily worth of the fund and dividing it by the total number of shares purchased.) More Terms Explained here |
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