COMMON INVESTMENT TERMS EXPLAINED: Part 4

Another day, another handful of terms for you. Check these out, and let us know if you have any questions!

No-Load Fund: A mutual fund that is sold without a sales commission and doesn’t have a 12b-1 charge of more than 0.25% per year. (See next week’s blogs for definition of 12b-1 fees)

Open-end Fund: A mutual fund that sells shares directly to investors. The fund also buys back shares when investors decide to sell. The price of the shares is always the Net Asset Value (NAV).

Payroll Deduction Plan: Some employers provide employees the option of deducting a specific amount from their paycheck at regular intervals; those monies are then used to purchase mutual fund shares.

Portfolio: The collection of securities (stocks, bonds, and other financial instruments) held by the mutual fund. The sum of your investment holdings would be your own personal portfolio.  

Prospectus: Mutual funds have to provide an official document that describes the mutual fund to prospective investors. The information is required by the SEC and contains such attributes as policies, fees, and risks.

Thanks for reading another post on common investment terms! Stay tuned for more, and as always, feel free to reach out if you want to chat about your own investment journey.