Thanks everybody, I have read all replies and settled on this:
A mutual fund is a type of investment fund that falls under indirect investment and that usually has an open-end structure, allowing investors to buy or sell shares at the fund’s Net Asset Value (NAV) daily. This high daily liquidity is possible because mutual funds invest primarily in liquid assets (e.g., stocks and bonds), enabling them to determine the NAV based on market demand each day.
Mutual funds are typically managed by an external management company, known as the fund sponsor. The fund sponsor is responsible for setting up and administering the mutual fund. They hire fund managers, analysts, and other staff to make investment decisions and oversee the fund's performance.
These employees work for the management company, not directly for the mutual fund, making it a zero-employee company. This separation helps reduce conflicts of interest, as the mutual fund’s operations and investment decisions are managed independently. The structure ensures that the primary focus remains on serving the interests of the investors (the fund owners) rather than aligning with the sponsor's business priorities.
A mutual fund is a type of investment fund that falls under indirect investment and that usually has an open-end structure, allowing investors to buy or sell shares at the fund’s Net Asset Value (NAV) daily. This high daily liquidity is possible because mutual funds invest primarily in liquid assets (e.g., stocks and bonds), enabling them to determine the NAV based on market demand each day.
Mutual funds are typically managed by an external management company, known as the fund sponsor. The fund sponsor is responsible for setting up and administering the mutual fund. They hire fund managers, analysts, and other staff to make investment decisions and oversee the fund's performance.
These employees work for the management company, not directly for the mutual fund, making it a zero-employee company. This separation helps reduce conflicts of interest, as the mutual fund’s operations and investment decisions are managed independently. The structure ensures that the primary focus remains on serving the interests of the investors (the fund owners) rather than aligning with the sponsor's business priorities.
Statistics: Posted by InvestementBear — Fri Nov 15, 2024 4:30 am — Replies 7 — Views 493