Diversified Fund

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Diversified Fund

A fund that has invested in many different types of securities in order to hedge against the securities already in the fund. Ideally, this reduces the risk inherent in any one investment, and increases the possibility of making a profit, or at least avoiding a loss. This may also reduce the expected return on the fund, but it depends on the level and type of diversification. There are two main types of diversification that a fund may utilize. Horizontal diversification involves investing in similar investments. Examples include investing in several technology companies or in different types of bonds. Vertical diversification involves investing in very different securities; for example, one may choose to invest in securities traded in different countries, or in both winter clothing and swimsuit companies. Both types of diversification may be as broad or as narrow as the fund's manager chooses. In general, broader diversification equates to less risk and less return.
References in periodicals archive ?
Little wonder then that diversified funds are attracting clients in ever greater numbers.
Legal & General Investment Management (LGIM) is delighted to announce that its Diversified Fund has passed Au1 billion in assets under management, with LGIM now managing a combined Au2.
The Fairholme Fund is non-diversified, which means that it invests in a smaller number of securities when compared to more diversified funds.
According to Srividhya Rajesh, fund manager at Sundaram BNP Paribas Mutual Fund, focused funds are meant for investors who are familiar with equities; first-timers are better off with diversified funds.
Comisky said the Bar made money in most of the diversified funds it invested in, but had the best return on those investing in small cap and large cap stocks.
The Fairholme Fund is non-diversified, which means that The Fairholme Fund invests in a smaller number of securities when compared to more diversified funds.
The Fund is non-diversified, which means that the Fund invests in a smaller number of securities when compared to more diversified funds.
The Fairholme Focused Income Fund is non-diversified, which means that it invests in a smaller number of securities when compared to more diversified funds.
Select Sector SPDRs bear a higher level of risk than more broadly diversified funds.
Funds that concentrate their investments in a single industry or sector may face increased risk of price fluctuation over more diversified funds due to adverse developments within that industry or sector.
Sandra Manzke is a recognized pioneer in hedge fund consulting to high-net worth and institutional investors, and in the creation of diversified funds of funds through the identification of talented investment advisors.
As such, investing in the Funds may involve greater risk and volatility than investing in more diversified funds.

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