Long Term Funds

Emphasize relatively safe high quality investments

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Unformatted text preview: cks and bonds i. Emphasize relatively safe, high quality investments, kind of like a “one stop” shopping for fund investors b. Asset Allocations Funds- 2 types of funds i. The first is an extended version of the balanced fund ii. Flexible portfolio fund- here the manage may hold up to 100 % in stocks, bonds, or money market instruments depending on his view about the performance of these investments 1. These funds try to time the market, guessing which general type of investment will do well over the months ahead. c. Convertible Funds- meaning they can be swapped for a fixed number of shares of stock at the option of the bondholder d. Income Funds- emphasized generating dividend and coupon income on investments. So it would hold a variety of dividends paying common stocks, preferred stocks and bonds of various maturities e. Target Date Funds- AKA as life-cycle funds, the asset allocation chosen by target date funds is based on the anticipated retirement date of the investors holding the fund i. Will likely be heavily allocated to stocks both domestic and internationally ii. As the years pass the manager will increase the asset allocation to fixed income and decrease the equity holdings of the portfolio 3. Mutual Fund Objectives: Recent Developments a. In recent years there has been a trend toward classifying a mutual funds objective based on its actual holdings b. All stocks are growth, value, or a mixture of the two...
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