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What is the Dow Theory? Dow Theory is a collection of indicators and definitions of the types of market signals for indicating a Bull or Bear marke...
What is the Efficient Markets Theory? The Efficient Markets Theory says that stocks trade at their fair value all of the time, assuming all informa...
What is a Fund of Funds? A fund of funds is a mutual fund strategy that invests in other funds rather than investing in stocks or bonds. The underl...
Finance: What is a Diversified Mutual Fund? 20 Views
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Description:
What is Diversified Mutual Fund? Diversified mutual fund allow individual investors to obtain the benefits of risk mitigation through diversification albeit on a proportionate scale to investment size. A diversified fund will often have both income and growth portfolio aspects, and will be measured against certain indexes as benchmarks (which the fund may also replicate) for outperformance target metrics.
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Transcript
- 00:00
finance a la shmoop what is a diversified mutual fund? all right people
- 00:08
listen up it's lots of investments stocks bonds exposure to risk and reward [Risk and reward punch man in face]
- 00:14
everywhere energy, telecom, insurance, real estate, banking, chemicals, tech, retail not
- 00:22
enough diversity yet well those are just sectors or industries and there's a
- 00:26
whole bunch of them what about geography geographic diversity the US, Russia, China
Full Transcript
- 00:31
Europe someday maybe Mars Elon what do you think well maybe exposures to [Elon Musk floating in space]
- 00:36
different currencies or commodities cycles as the diversity you seek hmm
- 00:41
well that's diversity Benetton eat your heart out so the bigger question is why
- 00:46
would you want such diversity? well the idea is that you mitigate risk by being
- 00:52
diverse the don't put all your eggs in one basket thing if one investment goes [Value of investment graph appears]
- 00:57
bust well at least you have plans B C and D to fall back on and if this is
- 01:01
grabbing you check out our videos on efficient markets theory for more on the
- 01:05
subject or maybe diversify your knowledge and watch all of our finance
- 01:10
videos food for thought and you know please click on the ads that we got to [Man holding begging sign]
- 01:14
eat around here
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