Home     About Us    Contact Us     Contribute
Investing
Stocks
Bonds
Mutual Funds
Biz
Credit
Career
College
Economics
Tax
More
 
 
Selected Offers
Rapid Card Search
No matter your credit find you perfect card here

Credit Repair Consultation
Start Improving Your Credit Score Today

Merit Card
Bad credit, No credit Instant approval guaranteed

Credit card Hub For Bad credit
Get guaranteed approval for a credit card now

Marketplace
Related Articles
More
Related Definitions
More
Related Categories
Tip of the Day

Tip of the Day Take A Deep Breath

Take A Deep Breath - After reading this if all you have done is follow five to seven of the tips offered you are now saving more money than you...

read entire tip

Related Podcasts
Recently Added
More
You Recently Visited
Other Great Sites
 

Long Short Mutual Funds

Long short mutual funds are a type of mutual fund which uses strategies that will maximize total return. These funds are less sensitive to stock market drops. They are similar to hedge funds, but are more regulated. This limits the risks taken by the average investor.

Unlike hedge funds, these funds are available to the public. They have regulations that determine how much risk a fund can take. While this limits how much the fund will make, it prevents the fund from collapsing. This makes them more appealing to try.

Some of the strategies used are leverage, derivatives, and short positions. Leverage allows the fund manager the ability to increase his stock purchases. Derivatives are contracts based on an underlying asset affected by future events. (If said event occurs, the stock contract will be worth this much.) Short positions, or short selling, is used to offset a stock that is not performing well with the hope that it can be repurchased at a lower price, and thus reduce the loss. The law limits how many derivatives and short positions that can be taken. It, also, regulates how much leverage the fund may contain.

The fund manager watches the stock market trends. When there is a downturn in the market, he will use specific strategies to keep the fund from feeling the effect. This gives a buffer to the fund, and allows the market time to recover. When there is an upturn, the manager can take advantage of it. By staying proactive, he will provide a much better return to the average investor.

Most funds have several advantages. They have a minimum investment of $1,000.00. The investor will not be locked in for a set period of time. The fees are considerably less.

In short, these mutual funds are the best of both worlds. The benefits of a hedge fund enhanced profits, while limiting the excessive risks. They have a better return than the standard mutual fund, too. Fund managers look for the best possible return on the money invested. These advantages will allow the investor to be able to weather the stock market changes, and thus grow his portfolio.

Discuss It!
Most Popular Articles
More
Most Popular Definitions
More
 
Daily Definition

Definition of the Day Claim Dilution

Claim Dilution - a claim dilution is a decrease in the likelihood that one or more parties in a contract will be repaid in full.  A dilution is a change on earnings per share of a stock, and a claim dilution may occur if the following happens. A company adds...

read entire definition

 
 

 

 

Home     About Us    Contact Us     Contribute     Sitemap

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Copyright © 2009 TeenAnalyst.com