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Equity funds

Equity funds . Joshua Gouveia Money Investment. Define broader group of investment. An equity fund can be a mutual fund or an exchange-traded fund (ETF) that invests in equities (stocks). Thus, equity funds are also called stock funds . FEATURES OF EQUITY FUNDS

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Equity funds

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  1. Equity funds Joshua Gouveia Money Investment

  2. Define broader group of investment • An equity fund can be a mutual fund or an exchange-traded fund (ETF) that invests in equities (stocks). Thus, equity funds are also called stock funds. • FEATURES OF EQUITY FUNDS • Have a specific risk orientation. For example, they could be focused on growth or value. • May be focused on the size of the companies. They could invest in the stocks of small, medium or large-cap companies. • May be focused on a certain market sector. • Long-term growth through capital gains • Healthy return on investment (ROI) through dividends

  3. Know your limits • High returns. In order to persuade investors to invest, you may have to promise to pay higher returns than the rates you’d pay to a bank or other debtor if you took out a loan. Taking on such high returns can cripple many small businesses. • Giving up control of your business. When you raise financing through equity, you’re required to give up ownership, a percentage of profits, and, to some extent, control of the company. • It complicates the decision-making process. Before you make big decisions with respect to your business, you’ll have to consult your investor-shareholders. This can be an administrative hassle, and especially difficult if you don’t see eye to eye on the decision

  4. Appealing to who? • Compared with investors’ direct investment in the stock market, equity funds have the characteristics of portfolio investment and risk diversification. In addition, investing in equity funds, investors can enjoy the low cost advantage. • Also compared with other funds, equity funds have various styles. So they are suitable for different investors who have different requirements for risk and revenue.

  5. How do you make money? • You can make money from a mutual fund in three ways: • 1) Income is earned from dividends on stocks and interest on bonds. • 2) If the fund sells securities that have increased in price, the fund has a capital gain. The gains goes to investors • 3) If fund holdings increase in price but are not sold by the fund manager, the fund's shares increase in price. You can then sell your mutual fund shares for a profit.

  6. Economic climate • Equity funds work well in many different economic climate because it is the same as mutual funds. • But they do good In a healthy growing economy.

  7. Top Earning companies Funds • American Funds American Mutual Fund (AMRMX) • T. Rowe Price Equity Income Fund (PRFDX)

  8. Cost of Equity Funds/ Risk • You can buy Equity Funds from various price ranges depending on what you invest in too. • The Risk level of Equity Funds are High risk.

  9. Equity Char t (AMRMX)6 month chart

  10. Equity Char t (AMRMX)1 year chart

  11. Top 3 Sources • http://www.investopedia.com/university/mutualfunds/mutualfunds1.asp • http://mutualfunds.about.com/od/managingyourportfolio/a/How-To-Beat-Inflation.htm • http://www.fundcn.org/knowledge/the-characteristics-of-equity-funds/

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