Hedge Fund Vs Mutual Fund Essay

Mutual Funds are a pool of funds collected from many investors in order to purchase stocks, bonds, and other investments in greater amounts. Mutual funds are shares of ownership in a group of companies.

• Managed growth or capital growth funds—structured to maximise the return from capital growth, that is, an appreciation in the value of the assets held. Less emphasis on income receipts. Higher risk profiles within an investment portfolio; therefore, will usually hold a higher percentage of funds in equity investments and a much smaller portfolio of fixed interest investments.

think of a mutual fund as a company that brings together a group of people and invests

Who doesn't want to make money? Everyone right? An American Hedge Fund is a great read for all those who want to be successful in life because it shows you how to think smarter, along with what is achievable with money (which is the most important thing on earth). This book, written by Timothy Sykes, shows the ease of becoming a self made millionaire, if you are motivated to do so. Timothy Sykes began his millionaire conquest at the age of 14 where he gained interest in the stock market. By his freshman year in college he figured out a way to determine a pattern for stocks fluctuating prices. His pattern allowed him to buy and sell stocks making huge gains and minimal loses. After his new profound wealth, it made him realize, “for better or

For the majority of working Americans, the most common vehicle for owning mutual funds is through their employer's retirement plan, but very few people are making the most of this mainstay of retirement planning.

A mutual fund manager is a person who actively buys or sells and sometimes both funds. They are experienced in implementing a funds strategy used for investing and manages its trading activities as well as the portfolio. Choosing whether or not to invest in Ford Motor Company will take the use of a SWOT analysis and learning about the stakeholders of the company.

Money Market Mutual Funds are investments whose purpose is to provide investors with a safe place to invest. They are

This quote shows just how complex investing in mutual funds can be for a person especial if he or she knows nothing about investing.

Hedge funds feature returns different from those of mutual funds. The different trading strategies and investment styles are amongst a few factors that explain the difference (Boyson, 2010). The institutional and individual investors create a common pool of funds and employ professional managers to manage the fund. Ideally the manager is compensated from two sets of fees: management fee and performance fee. They impose a management fee based on the size of the asset managed, usually at the rate between 1-2%. A performance fee will be imposed at the rate between 20-30% of the returns on the investments made (lecture notes).

Mutual fund Industry was introduced in India 1963 with the formation of Unit Trust of India. During the last few years many extraordinary and rapid changes have been taking place in the Mutual fund industry. Indian economy is highly developing. The development is taken place due to the growth in the financial system.

Hedge fund industry, one of the fastest growing sectors in the financial service industry, has been attracting high net-worth and major institutional investors such as large pension funds and university endowments due to its distinctive characteristics. With a rapid rate of growth, the hedge fund industry also attracts attention of academics. They have analysed the performance of hedge funds from different perspectives and implied the necessity of further researches on hedge funds’ capital adequacy.

Mutual funds are an easy, convenient way to invest, without having to worry about choosing individual stocks. A mutual fund can be defined as a single portfolio of stocks, bonds, and/or cash managed by an investment company on behalf of many investors. The investment company manages the fund, and sells shares in the fund to individual investors. When one invests in a mutual fund, they become a part-owner of a large investment portfolio, along with all the other shareholders of the fund. The fund manager invests the contributions when shares are purchased, along with money from the other shareholders. Every day, the fund manager counts up the value of all the fund's holdings, figures out how many shares have been purchased by

160-161). Once these options are reviewed then one can make that optimal decision as to what type of investment would be the best options to choose from. Next, is bonds which is a financial instrument, that is issued by a corporation or government entity and is required to be paid back; known as an IOU. These will mature overtime and gain face value, and usually come in all types and varieties to choose from; some taking as long as 100 years to reach it maturity date. Lately, is mutual funds and EFT’s, these are securities that are held in different sectors and eliminate any form of risk compared to other investment; known as the closed-end fund or the open-ended fund. So, what is a “close-end fund, is a fixed amount of dividends in a portfolio of assets; where shares of a closed-end funds can be traded among investors much like stocks” (Kelly & Williams, 2017, pg. 163).

Walia et al. (2009) evaluated the investor’s perception towards risk-return trade-off for mutual fund services in comparison to other avenues like insurance, government securities and shares. The authors made use of a structured questionnaire to know the experience of existing investors. Selective systematic sampling was taken for consideration. For reliability of the questionnaire, 100 individual investors were selected from different regions of Punjab which included selective investors who were assumed to be having completeknowledge offinancial environment. Age constraint was considered. The authors identified critical gaps in the existing services and found the need of some innovations and added quality dimensions in the existing services. It was concluded that due to stock market volatility movements, most of the investors were holding stock with calculated risk in shape of mutual funds. Age constraint considered in this questionnaire was minimum 18 years. Another objective was to find critical gaps in mutual funds services towards transparency and disclosure practices. Chi-square test was applied on the data collected. So, the

The securities and Exchange Board of India (Mutual Funds) Regulation, 1993 defines a mutual fund “a fund established in the form of a trust by a sponsor, to raise monies by the trustees through the sale of units to the, public, under one or more schemes, for investing in securities in accordance with these regulations”.