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Equity Funds

In: Business and Management

Submitted By nanthamk
Words 457
Pages 2
What Does Equity Fund Mean?
A mutual fund that invests principally in stocks. It can be actively or passively (index fund) managed.

Also known as a "stock fund".

Investopedia explains Equity Fund
Stock mutual funds are principally categorized according to company size, the investment style of the holdings in the portfolio and geography: Size is determined by a company's market capitalization, while the investment style, reflected in the fund's stock holdings, is also used to categorize equity mutual funds.

Stock funds are also categorized by whether they are domestic (U.S.) or international. These can be broad market, regional or single-country funds. There are so-called "specialty" stock funds that target business sectors such as healthcare, commodities and real estate.

The basic feature of unit trust investment is a form of collective investment that allows investors with similar investment objectives to pool their saving, and invested in a portfolio of securities managed by investment professional.

We can classify 5 mains categories of unit trust funds in Malaysia:

1)Equity fund: The major portions of equity fund portfolios are shares of listed companies. It's available in the market with higher risk-higher return to those with lower risk-lower returns:

·Aggressive growth fund - generally invests in companies with higher capital growth, but with higher risk.
·Index fund- normally the return will closely resemble the performance of the stock market index, both in

terms of risk and return.
·Income fund - the fund will invest primarily in stocks that earn significant dividend income, rather than

companies that are expected to pay little or no dividends.

2)Fixed Income fund: Mainly invest in corporate bonds, government securities and liquid securities. Generally it will provide regular income with less emphasis on...

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