FINA 200 Lecture Notes - Lecture 9: Foreign Exchange Risk, Interest Rate Risk, Market Risk
Document Summary
Pooled investment: investment vehicle that pools together money from many investors and invests that money in a variety of stocks, bonds, or indexes of stocks and/ or bonds. Many different types of pooled investments: mutual funds, etf, segregated funds. Marketability: ease at which an investor can convert investment to cash. Equity mutual funds: sell units, or shares, to individuals and use this money to invest in stocks. Bond mutual funds: sell units, or shares, to individuals and use this money to invest in bonds. Balanced mutual funds: sell units, or shares, to individuals and use this money to invest in a combination of stocks and bonds. Money market mutual funds: sell units, or shares, to individuals and use this money to invest in cash and investments that can be converted to cash quickly (very liquid investments) The initial investment in a mutual fund is anywhere between 500 and 5000 $ depending on the fund.