A mutual fund that invests predominantly or exclusively on the receivables from lease agreements. Because there is little or no secondary market for leases, the fund must directly purchase the leases in the fund. A lease fund operates much like a bond fund, but with shorter maturities for the underlying assets.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
An investment company that invests the shareholders' money in lease obligations. A lease fund is very similar to a bond fund except that the maturities of its investments are shorter. Because leases do not have an active secondary market, the fund manager must secure outside agreements to buy the leases in case the shareholders redeem their shares.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.