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 ?
If you're tempted by those double-digit yields, the safest way to pursue these bonds is through a diversified mutual fund.
So, even if your investments are modest, spread out to several kinds of stocks--or into a widely diversified mutual fund.
Since 2001, FTJ FundChoice has provided financial advisors the ability to manage diversified mutual fund portfolios for their clients through access to leading investment managers.
If an Underlying Fund focuses its investments in a limited number of issuers, its NAV per share, market price and total returns may fluctuate more or fall greater in times of weaker markets than a more diversified mutual fund.
The Corporate Bond Fund is an open-end, diversified mutual fund managed by Delaware Management Company.
today announced that their Focus 30 Fund was the top performing diversified mutual fund in the nation for 2005.
Coyne added: "Destinations is a simple and effective means for financial advisors to offer broadly diversified mutual fund asset allocation strategies to their clients.
The Dividend Income Fund is an open-end, diversified mutual fund managed by Delaware Management Company.
The CPI ETF is non-diversified and is susceptible to greater losses if a single portfolio investment declines than would a diversified mutual fund.
The book explains how people can identify their financial goals and create diversified mutual fund portfolios to help them reach their objectives.
The Fund is non-diversified and may be susceptible to greater losses if a single portfolio investment declines than would a diversified mutual fund.

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