He can not understand the confusion on the exact definition of investment funds, especially the secular parlance. However, there is no need for confusion. A simple definition of hedge funds is that there is a professionally managed type of collective investment that combines funding from several investors to invest in bonds, shares or other assets. The combined holding bonds, stocks and other assets are portfolios. EveryInvestor holds the shares of the holding company.

Treasury instruments, stocks or bonds: The fund may invest in various securities. There are several subcategories. Equity Fund may be primarily in shares of a particular sector, such as tools and technologies to be invested. They are known as sector funds. Always a professional manager, supervision of investment funds and portfolios, monitors and forecasts cash flow and leave the groundand investors see the future returns. He or she also chooses investments that will monitor the Fund's investment objectives.

Mutual

There are three ways to make money from investment funds:

You can earn dividends from shares, bonds. The fund pays for most of the year, the income distribution to the holders of the Fund.

If the fund sells a value that was more valuable than no capitalProfit. This benefit is generally allocated to investors.

If the sale of the assets of the fund's price increases, but the manager does not, the value of the Fund's capital growth. You can then sell their shares for a profit.

The fund will also be an opportunity to get a check for the distribution or to invest their money / profit to buy more shares.

Benefits of Funds:

* Professional management: an investment fund is a greatin a professional way to manage your money if you do not meet the time or knowledge to do their jobs. with the Fund is less expensive for small investors a full-time manager to look after money and investment decisions.

Investment funds have the ability, the money in many areas and sectors that does not extend to retail investors, on their own Diversification *. Therefore, the risk is to diversify.more parties in various areas, the probability of loss.

* Economies of scale are very low transaction costs, as a fund buys and sells large quantities of securities at the time.

* Liquidity: As a single mutual fund shares can be converted into cash at any time.

* Easy to investing in the fund is simple if you understand the definition of mutual relationships. Banks often have their line of mutual Fund and the minimum investment is small. Even just $ 100 you can spend on a monthly basis.