Mutual Fund Manager
Definition of the Fund Manager Position and Major esponsibilities

Securities and Exchange Commission defines a mutual fund as a company that pools money from many investors and invests the money in stocks, bonds, short-term money market instruments, other securities or assets, or some combination of these investments (U.S. Securities and Exchange Commission, 2008). Mutual funds are in turn operated by professional money managers, the fund managers, who invest the fund's capital in accordance with the funds' stated objectives, with the intent to produce capital gains and income for fund investors. This paper examines the role of the mutual fund manager.

Also known as an investment manager, the manager of a mutual fund is responsible for making all the investment decisions on behalf of the investors. The fund manager is tasked with implementing the fund's investment strategy and managing it portfolio trading activities. For these reasons, investors look for specific attributes…...

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Reference List

Baks, K.P. (2003). On the performance of mutual fund managers. Retrieved June 22, 2011 from  http://www.goizueta.emory.edu/faculty/klaasbaks/documents/manager_000.pdf 

Infotec-forums. (2011). Become a mutual fund manager. Retrieved June 22, 2011 from  http://infotec-forums.blogspot.com/2011/05/become-mutual-fund-manager.html 

Investopedia. (2011a). Fund manager. Retrieved June 22, 2011 from  http://www.investopedia.com/terms/f/fundmanager.asp#axzz1Q4VgUohP 

Investopedia. (2011b). How do you find out the price of a mutual fund? Retrieved June 22, 2011 from  http://www.investopedia.com/ask/answers/03/090503.asp#axzz1Q4VgUohP

b) It is required that the "summary prospectus appear at the front of a fund's prospectus." (Security Exchange Commission (b))

c) Amendments have been made so that the Internet can be used to give important 'information' inclusive of "description of the fund's investment objectives and strategies, fees, risks, and performance." (Security Exchange Commission (b))

d) The Form N-1A, for mutual funds, should have the "key information at the front of its statutory prospectus" regarding "the fund's investment objectives and strategies, risks, and costs. The summary will also include brief information regarding investment advisers and portfolio managers, purchase and sale procedures, tax consequences, and financial intermediary compensation." (Security Exchange Commission (b))

d) It is enough to send the summary prospectus for the delivery requirements if all other information is made freely available online. The 'online materials' has to be accessible and 'in a format' which permits easy navigation and all information must be made…...

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References

Citibank Online. Mutual Funds from Citibank: Disclaimer. 2009.

Lowy, Martin. High Rollers: Inside the Savings and Loan Debacle. Praeger Publishers:

New York. 1991.

98% to 43.72%. The average fund in this category has a mean total return of -0.64% and a standard deviation of 12.23
USAA Precious Metals and Minerals (USAGX), 2009).

Another factor that one should look at when contemplating investing in a mutual fund is how much the fund has rewarded shareholders relative to the risk they have taken.

One should look at a risk-adjusted measure of performance known as the Sharpe ratio. It balances volatility against total return to reveal funds that have delivered the most gains with the least risk. A good fund will have a Sharpe ratio higher than 1.0. The rule is the higher the Sharpe ratio the better. USAA Precious Metals and Minerals has a Sharpe ratio of 0.3%. The average for all funds in this same category is -0.9%

USAA Precious Metals and Minerals (USAGX), 2009).

If you look at the Modern Portfolio Theory Statistics for the USAGX fund you…...

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References

How to Pick the Best Mutual Funds. (2006). Retrieved March 14, 2009, from Winning

Investing.com. Web site:  http://winninginvesting.com/fund1.htm 

Invest Wisely: An Introduction to Mutual Funds. (2008). Retrieved March 14, 2009, from U.S.

Securities and Exchange Commission. Web site:  http://www.sec.gov/investor/pubs/inwsmf.htm

The first aspect of successful mutual fund performance is to define a benchmark. Most funds have specific benchmarks that they use both internally and externally. Externally, the benchmarks are often used in promotional material, relating the performance of the fund to the performance of the Dow Jones Industrial Index or some other broad-based market indicator. Funds operating in specific sectors will benchmark against a sector index. The idea behind this is that the fund should demonstrate a track record of success - otherwise the investor should simply purchase the Index, many of which are available as exchange-traded funds. Internally, fund benchmarks are more complex. For example, the risk level of the fund relative to the market is factored into the equation.
The next component of mutual fund performance is the ability to analyze securities. Most major fund companies employ experts who can make specific recommendations within a given sector. The…...

The correlation was expected to be relatively weak because even high value funds can experience exceptional performance.
The weakest correlation (0.056), which is not a significant correlation at all, is with the Morningstar rating. This is somewhat surprising, because the Morningstar rating presumably takes the fund's historical returns into consideration. However, in any given year the fund may or may not perform according to its track record. This could result in a divergence between the Morningstar rating and total returns.

There are also correlations noted between the type and the NAV and the type and the expense ratio. It should be expected that the latter would hold, because the cost of managing a fund is dependent on the cost of analyzing and trading the securities the fund. It would be expected, for example, that an international equity fund would cost more to manage than a fixed income fund.

What this analysis shows…...

When looking at risk, the fund does have a beta higher than that of its large cap blended peers. The beta of the fund is roughly 1.23 as compared with a beta of 1.04 for many of its peers. This can be attributed to the large concentration in financial stocks which tend to have high betas relative to the market. This is to be expected as financial shares raise disproportionately more when the economy recovers and fall just a much when the economy enters recession. The standard deviation of the portfolio is also higher at 18.15 relative to its peer group standard deviation of 15.86. These numbers again reflect the volatility inherent in a portfolio with 40% of the assets in cyclical industries such as banking and technology.

To improve performance and volatility in the fund, I would recommend two courses of action. First, I would lower the expense ration and…...

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References:

1) Bogle, John. (2007) "The First Index Mutual Fund: A History of Vanguard Index Trust and the Vanguard Index Strategy."

2) Burton G. Malkiel, a Random Walk Down Wall Street, W.W. Norton, 1996, ISBN 0-393-03888-2

3) Rekenthaler, John (February/March 2011). "The Weighting Game, and Other Puzzles of Indexing." Morningstar Advisor. pp. 22 -- 56.

Load Fees and Mutual Funds 1. Do you think it is worth paying the initial load fees mutual funds sometimes require? Why or why not? Please explain your reasoning.
It is not worth paying the initial load feeds that are at times necessitated by mutual funds. The initial load fees are disadvantageous to investors largely for the reason that it negatively impacts their capability to earn more money from the mutual funds. For instance, if a mutual fund carries an initial load fee of 6.25 percent, it implies that the broker will obtain $625 for every $10,000 that is invested in the fund. The inference of this is that the investor is left with $9,375 to begin with. The implication is that the investor has to find a way of earning back this amount of $625 that was given to the broker in order to break even. Moreover, the investor ends up…...

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References

Bold, A. (2011). Why Investors Should Avoid Load Funds. US News. Retrieved from:

Greenberger, I. (2017). Why Invest In International Equity Mutual Funds? Investopedia. Retrieved from: https://www.investopedia.com/articles/mutualfund/08/international-equity-mutual-fund.asp

Lim, P. J. (2017). Worried About U.S. Stocks? Put Your Money Here Instead. TIME. Retrieved from: http://time.com/money/4955301/europe-stock-market-cheaper/

https://money.usnews.com/money/blogs/the-smarter-mutual-fund-investor/2011/03/01/why-investors-should-avoid-load-funds

Fidelity Large Cap Stock Fund is a domestic equity fund, comprised of 91% domestics and 9% international equities. As such it is not intended to mirror the performance of either the Dow or S&P 500, but to serve as a competitor product. The foreign stocks are mostly from the UK, Canada, Israel and Ireland. The fund has very little foreign exchange exposure, with 95.91% of the stocks denominated in the U.S. dollar, and just a small amount each in the Canadian dollar and British pound. Most foreign exchange risk in this fund comes from the fact that the fund is comprised mainly of multinational companies, many of which have significant foreign exchange exposure themselves.
Fidelity is one of the largest mutual fund companies, but the Large Cap is not one of its bigger funds, with a portfolio net assets of just $2.9 billion. The expense ratio is 0.88%, and the fund…...

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References

Fund Research. (2015). Fidelity Large Cap Stock Fund. Fund Research. Retrieved November 11, 2015 from  https://fundresearch.fidelity.com/mutual-funds/summary/315912402 

Morningstar (2015). Fidelity Large Cap Stock Morningstar. Retrieved November 11, 2015 from  http://www.morningstar.com/funds/xnas/flcsx/quote.html 

Appendix A: Composition of Fidelity Large Cap vs. S&P 500.

Major Market Sectors

Depository Institutions & Mutual Funds WSJ Article eview
In a recent article entitled Advisers Face Barrage of Mutual-Fund Pitchmen, which was published by The Wall Street Journal on March 5th, 2013, financial reporter Corrie Driebusch describes the growing diversity in mutual fund varietals being offered by wealth management firms, as well as the deluge of telephone calls being used by mutual fund wholesalers to court potential brokers. The purpose of the article is to inform readers about this increasingly prevalent distraction faced by wealth managers and financial advisers, who are now forced to deal with dozens, if not hundreds, of solicitations on a daily basis from mutual fund wholesalers hoping to peddle the potential of a profitable fund investment. According to Driebusch, "as the largest wealth-management firms have embraced the widening range of mutual-fund offerings, from products by the traditional heavyweight fund families to newer niche strategies, brokers have more choices…...

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References

Driebusch, C. (2013, March 5). Advisers face barrage of mutual-fund pitchmen. The Wall Street Journal. Retrieved from  http://online.wsj.com/article/SB10001424127887323494504578342231699258980.html 

Kim, J.J. (2010, June 5). Credit unions: A better bet than banks?. The Wall Street Journal. Retrieved from  http://online.wsj.com/article/SB10001424052748704515704575283092306576952.html

Investing Capital
Mutual fund

Investing is important for it ensures that at the end of a certain period you can benefit out of your invested money. Investing can be done through investment funds. Investing funds are collective investment schemes that require investor to create a pool of capital and in return the investor enjoys wide diversification, professional management, and lower costs that would have been otherwise impossible using a small amount of money. Several funds company exists all over the world, and so are the online tools that are used to compare performance of these companies. Such companies help to simplifies decision-making process as well as pre-screens investments on behalf of their clients who are not able to choose the best funds that they can invest in. Though there are some private banks that also offer the services, the investors end up paying higher as compared to one fund manager.

Investment Vehicle

They act…...

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References

Abacus Consulting Services, (2009). "Advantages and Disadvantages of Mutual Funds." Retrieved July 22, 2013 form  http://chinese-school.netfirms.com/abacus-mutual-funds-advantages.html 

Andrew Chan, (2011). "Exchange Traded Funds: Advantages and Disadvantages." Retrieved July 22, 2013 from  http://www.boston.com/business/personalfinance/managingyourmoney/archives/2011/02/exchange_traded.html 

Associated Newspapers Ltd., (2012) "A guide to cheapest tracker funds." Retrieved July 22, 2013 from  http://www.thisismoney.co.uk/money/investing/article-1583915/A-guide-cheapest-index-tracker-funds.html#ixzz3Hj6CZcfY 

CAF Partnerzone, (2013). "Active vs. passive investing: which is right for your charity?" Retrieved July 22, 2013.  http://www.guardian.co.uk/voluntary-sector-network-caf-partner-zone/active-passive-investments-charities

International Mutual Funds
Mutual Funds, the dynamic market:

The business of mutual funds changes continuously and one of the things that is done is to replace the manager of the portfolio, or even change the investment strategy for the fund. If the fund has been badly affected, the practice is to stop buying the risky growth stocks and instead buy the slower industrial and consumer stocks. This is the situation now at many growth funds in the United States which have come down by about 40% during the last two years. Yet the changes often do not lead to the results that are expected, and the changes that may have been correct to take up a couple of years ago may lead to a lot of damages now, after the market has already gone through a decline.

The type of stocks that are not in favor at certain times may again come back…...

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Bibliography

Asian Funds. PFPC Distributors, Inc. May 23, 2004. Accessed 21 May, 2004. Available at  http://www.matthewsfunds.com/whyinvest.cfm 

FAQ's on Mutual Fund Investing. Fremont Mutual Funds, Inc. 2004. Accessed 21 May, 2004 Available at  http://www.gabelli.com/university/qa-mf.html 

Hamilton, Andrea. The Blind Spot in Mutual Fund Investing. August 2002. Accessed 21 May, 2004. Available at  http://www.gsb.stanford.edu/news/research/finance_mutualfunds.shtml 

Kurapka, David. Long-Term Gains Lie Ahead for International Fund Investors.

investment in the mutual fund industry and how fast it's growing. This growth was especially rapid during the 1990s. 401(k) plans have helped out with this growth, and contributed to the large number of mutual funds. Because of the proposed changes to Social Security, and also helped in some way by the Internet, nearly half of all households in the United States own some form of stock. Those who work in the financial industry are also happy about this growth in mutual funds. It means more opportunities for work for them. This article takes a closer look at what goes on, on a daily basis, in the life of a mutual fund accountant.
A mutual fund works much the same way that a partnership does. Mutual funds don't pay taxes, and the earnings that they make go straight through them and to their shareholders who have the responsibility of reporting…...

Question One One of the key advantages that mutual funds offer in comparison to company stocks is diversification. In particular, mutual funds will offer the investor diversification by means of the coverage of a range of stocks. The inference of this is that a company stock bears more risk in comparison to a mutual fund. Basically, when an investor invests and owns one company stock, then it implies that he bears the risk of the company, which may not be applicable in other corporations within the similar market sector. This means that if the firm goes through an adverse experience, for instance a manufacturing center breaking down, then the investor experiences a loss (Allaria, 2016).
As a result, investment in a mutual fund means that the investor has a number of different assets within the portfolio. This curtails the investor’s general investment risk as it facilitates spreading the risk faced to various…...

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References

Allaria, J. (2016). Why would a person choose a mutual fund over an individual stock? Investopedia. Retrieved 3 October 2017 from:  

Smith, J., Smith, R. L., Smith, R., & Bliss, R. (2011). Entrepreneurial finance: strategy, valuation, and deal structure. Stanford University Press.

Zacks. (2017). What Advantages Do Mutual Funds Offer Compared to Buying Particular Stocks? Retrieved 3 October 2017 from:  http://finance.zacks.com/advantages-mutual-funds-offer-compared-buying-particular-stocks-5069.html http://www.investopedia.com/ask/answers/05/062305.asp \\\\

 

1. Which mutual fund or funds did you choose, and why? Please include a discussion about your choice of active or passive funds
The mutual funds that I selected include Fidelity Total Bond, Vanguard Health Care, and Dodge & Cox Stock. These three mutual funds are suitable investment opportunities for generating strong returns for the investor. I selected the Vanguard Health Care Fund because it is an active fund that favors safer portfolio of stocks. In particular, the fund fundamentally invests in medium and large capitalization stocks within the international healthcare industry. In addition, the fees are specifically low despite the fact that it is actively managed. The fund purposes to maintain the fees and expenses to be considerably low, in spite of the fact that funds that are actively managed have greater operating costs as compared to passive funds. Most of all, in comparison to its peers, Vanguard Healthcare Fund…...

The Benefits of Mutual Funds and Employers Matching Employees’ Pension Contributions 
Question 1

Investing in a mutual fund has major advantages compared with investing in the company stock. The first benefit is diversification of risk. Mutual funds invest in many different companies, often across different industries (Bogle, 2015). This means if the value on one share in the portfolio falls, or evens collapses, it will not result in a significant decline in portfolio value (Bogle, 2015). This reduces the risk when compared to any investment in a single stock, where a change in the share price will impact directly on the value of the investment (Bogle, 2015). The purchase price of the investment units in the mutual fund will also reflect market condition, as they are determines by the underlying asset prices (Howells & Bain, 2007). This is an advantage compared to the company stock, as the firm is currently private, with…...

Components of the Financial Market

The financial market is a complex and dynamic system that plays a crucial role in the allocation of capital and the facilitation of economic growth. It consists of various components that interact to facilitate the flow of funds between borrowers and lenders. These components include:

Financial Institutions
Banks: Provide lending, deposit-taking, and other financial services.
Investment banks: Underwrite and sell securities, providing capital to corporations and governments.
Broker-dealers: Execute trades for clients in various financial instruments.
Insurance companies: Provide protection against risk by offering insurance policies.
Mutual funds: Pool investments from multiple individuals to provide diversified portfolios.
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1. Renting can provide flexibility in terms of location and housing options, allowing individuals to easily move for job opportunities or lifestyle changes without the financial burden of selling a home.

2. Buying a home can provide long-term financial stability and potential for wealth accumulation through property appreciation, mortgage paydown, and tax benefits.

3. Renting may result in higher monthly expenses compared to owning a home, as rental prices tend to increase over time while mortgage payments remain relatively stable.

4. Homeownership often requires a significant down payment and ongoing maintenance costs, which can create financial strain for individuals with....