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 ?
The firm's broadly diversified mutual funds are engineered and managed to precisely target dimensions of risk and capture their expected returns.
And once the interest rates reduce, move to diversified mutual funds.
For those who prefer not to tie up cash in an annuity, one alternative is to buy tax-efficient, diversified mutual funds such as stock index funds.
Diversified mutual funds or investment trusts do not constitute a competing financial interest.
Of the $134,000 in her 401(k), he suggests Debra take $34,000 and split that money up among three different stocks and place the remaining $100,000 in four diversified mutual funds.
The safest way to invest in any emerging market is through diversified mutual funds.
Funds that concentrate their investments in a specific sector, such as real estate, tend to experience more volatility and be exposed to greater risk than more diversified mutual funds.
When it comes to real-world investing, Gary suggests regularly investing in diversified mutual funds, contributing as much as possible to a 401K plan or IRA plan, maintaining a conservative stance, remaining value oriented and investing in something you know about.
Targeted risk funds are highly diversified mutual funds designed to simplify investing by providing exposure to a variety of asset classes through a single mutual fund while targeting specific risk and return objectives.
Limited partners benefit from a tax-deferred rollover to DMP and now have the opportunity to remain invested in DMP Resource Class, one of Canada's top-performing resource funds, or switch between different classes on a tax-deferred basis to one of five other diversified mutual funds within DMP in order to meet their investment objectives.
Funds that concentrate their investments in a specific sector, such as real estate, may experience more volatility and be exposed to greater risk than more diversified mutual funds.
Limited partners benefit from a tax-deferred rollover to DMP and now have the opportunity to remain invested in DMP Resource Class, one of Canada's top-performing resource funds, or switch between different classes on a tax-differed basis to one of five other diversified mutual funds within DMP in order to meet their investment objectives.

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