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Finance: What is co-variance?
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What is covariance? Covariance is the comparison of how assets move in the markets. Positive covariance is when assets move in tandem, such as when...

Finance: What is After Hours Trading?
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What is After Hours Trading/Extended Trading? After hours trading describes any trades made after the market closes or before the market opens. Bec...

Finance: What is Volatility?
77 Views

What is volatility? In the world of investing, volatility basically means riskiness. It looks at the returns for stocks or indexes, and if they are...

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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

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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