Mutual Funds Explained – Apollo Investment Management
Industry: Financial Services
Mutual funds are technically the most popular way to invest in securities. Since mutual funds can provide integrated diversification and professional management, they provide specific benefits over the purchase of individual stocks and bonds. However, like investing in any security, investing in a mutual fund comes with certain risks, including the possibility that you may lose money.
London, UK (PRUnderground) November 11th, 2019
Popularly known as an “open-end company,” a mutual fund is essentially an investment firm that pools money from a plethora of investors and invests the money in securities such as stocks, bonds, and short-term debt. The combined holdings of the mutual fund are known as its portfolio. The mutual fund raises money technically by selling its very own shares to investors. The money is then utilised to purchase a portfolio of stocks, bonds and other securities, or certain combination of these investments. Each individual share stands for an ownership segment of the fund and essentially gives the investor a proportional right, on the basis of the number of shares he or she owns, to capital gains and income that the fund produces from its investments.
Moreover, mutual funds give small or individual investors access to diversified, professionally managed portfolios at a significantly lower price.
Advantages of investing in a mutual fund
Mutual funds are essentially and actively managed by a professional and skilled money manager who round the clock observes and monitors the stocks and bonds in the fund’s portfolio. However, since this is his or her primary occupation, they can allocate considerably more time to choosing investments than an individual investor. It basically ensures the peace of mind that comes with informed investing without the stress of analysing and examining financial statements or calculating financial ratios.
In addition to that, mutual funds are equity investments, as individual stocks are. When you buy shares of a fund you basically become a part owner of the fund. This is true of bond funds as well as stock funds, which implies that there is a necessary distinction between owning an individual bond and owning a fund that owns the bond. Simply put, when you buy a bond, you are ensured of a certain interest rate and return of your principal.
Apollo Investment Management is an investment firm serving clients in the United Kingdom, providing transparent financial advice with integrity and a deep understanding of market realities.
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About Apollo Investment Management
We are a fully authorized and FCA regulated company proud to put our clients first and work with transparency and integrity. We tailor investment portfolios to suit the individual financial goals of our clients to help them make wise and safe investments with steady returns.