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Turnover -  Definition
Below, you'll find a definition of this investing term...

Definition: In mutual funds, it's the percentage of total shares in the portfolio that are traded in a given period (usually a year).

TeenAnalyst Advice: Investors prefer mutual funds with lower turnover rates because they have lower fees than those with higher turnover rates.  Also, if a mutual fund is constantly buying and selling shares, the investor will face a lot of short-term capital gains, which will hurt them on their taxes.

As investors, we want to stick to buy and hold strategies...so we would hope our mutual funds do the same.

 

Related Sections on Our Website

Investing - Learn more about investing basics and strategies.

Mutual Funds - Learn more about investing in mutual funds.

 

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