Mutual Funds are the way to used to invest money in a group of diversified business, intended application of the sale of the units by the financial audience of investors,
And investment funds as investment options that pool the funds of group of people called investors, and then invested the contents of these boxes; through reliance on the role of the Director Professional of each fund.
Definitions of other investment funds is an investment strategy allow each person to assemble their own funds with the funds of other persons, these include funds a range of diversified investments.
Fund management companies:
Money Management Company is a company providing financial services to diverse individuals; to help them achieve the best financial profit; which leads to increase the number of individuals interested in the services of these companies on a daily basis,
And fund management companies to a group of species of which the most important:
- Capital Companies: are companies that are interested investments of the enterprise organizational and individual clients, and to provide a range of financial services, such as management of investment funds, and accounts varied.
- Asset management companies: companies that care about the management of assets; by relying on the existence of a group of investment fund managers, and all of them are an international company in the financial markets all over the world.
- Commercial Banks: are financial institutions that accept deposits of client funds, and to provide appropriate management; the basic function of this bank is to maintain water, and also provide the possibility of providing financial loans for growing businesses, and individuals to buy products or to develop the operations of the company.
- Financial Brokerage is a broker between the individuals of the buyers and sellers of securities, and on the ease of implementation of the financial transactions between them.
- Investment Companies: are companies that are interested to invest the funds of individuals; through reliance on the use of portfolios of diversified investment, providing professional management for their stock; by collecting the funds of all investors with.
The advantages of investment funds:
Characterized by investment funds range of benefits including:
- Benefit from the expertise of professional management: Is the advantage of investors of the role of the management of the investment funds bear all the burdens of its management, aims to take investment decisions which help to build a selection suitable to the fund, and to follow the prices in the financial market, monitors the level of risk, as characterized by the diversification in the investment fund; which helps reduce the proportion of risks that affect holders of the stock; because the selection of the contents of each investment fund includes many of the securities of many companies, in the case of the Lost company of them does not lead to the loss of the rest of the companies, as no investor can single-handedly Fund Management the investment no matter how experienced his past.
- Flexibility and convenience: Are the advantages of special investment funds within the investment companies of the open end, and where the fund subject to repurchase to get the money from the owner Any amount of time, and this flexibility of features that provide excellent service to investors who may change their investment objectives their own; therefore characterized by investment funds to its ability to provide a range of investment tools appropriate to the circumstances and needs of investors, and low risk helps to encourage investors experienced few, and limited financial participation to invest their resources, their savings money in the purchase of bonds, stocks, and other types of securities Other; and helping the revitalization of the financial markets, whether primary or secondary. The objectives of the investment funds
The objectives of the investment funds:
Seeking investment funds to develop a set of goals that help in meeting the demands of investors, and ensure that commensurate with the level of risk, according to the goals that are determined in advance frees the fund manager to apply a range of strategies, policies and investment that are interested in the achievement of these objectives; thus leading to variation in the types of securities that constitute the contents of these boxes vary according to the nature of their goals, and generally make your goals, investment funds to the following:
- Investment objectives aims to maintain capital. Investment objectives seek to get the income.
- The objectives of the investment dedicated to the promotion of financial growth.
Forms of investment funds divide investment funds into a set of shapes, each designed to achieve specific objectives according to the nature of the field of investment, here comes a group of the most important forms of investment funds:
– Money market funds: are investment funds that invest in securities in the cash market, characterized by its water based, and short-term, and the degree of risk is low compared with the funds other investment; leading to low returns, but they don’t think free entirely from risks, but the amounts invested therein may be significantly reduced.
– Funds debt instruments fixed income: investment funds that rely on the use of debt instruments in the investment, such as bonds and instruments issued by enterprises, institutions, government, or any body corporate owns the rights to issue this type of debt instruments, influenced by the prices of bonds and sukuk by many factors special risks, such as the classification of companies classification of the type of bond, or the effects of the interest rate.
Types of investment funds:
Mutual funds are a method used to provide funds to private group of investors through securities fraud of their own, and maintains each investor’s ownership to his cards, financial and investment fund in providing a range of investment opportunities growing.
Investment funds, also known as a pot of money involved in the ownership group of investors, and is managed by specialists in the field of financial investment, and those who make decisions to buy or sell a group of securities, such as bonds and stocks, which helps in the diversity of private ownership of every shareholder in the investment fund.
Other declarations of investment funds as a means of gathering money for individuals, investors, corporations and diverse, and then contract with the director or financial expert to manage the contents of investment funds, the goal is to provide the highest financial returns with a lower risk possible.
Types of investment funds:
There is a range of special types of investment funds, for each type of role in the stock market, the IDMA information about them:
- Equity funds: are funds depend on the investment trading in general away from any ownership of the companies within the private sector, this is considered a investment funds the most volatile and change; they derive their value rise and decline within a short time period. Historically, the performance of stock funds the best among the types of investment funds; this is because stock trading is dependent on the future results of your company within its share in the market, which include a rise in revenues and profits, which leads to increase the value of investors ‘ rights.
- Fixed income funds: are investment funds, also called bond funds, investing in private debt in the public and private sector companies; in order to provide income based on the distribution of profits, usually contain these funds in the investment portfolio enhancing financial returns for the investor by providing a steady income when you lose the stock funds value in the financial market.
- Market funds Financial: are the boxes with the proportion of low risk compared with funds, other investment, and these funds to investments with high quality, which are often short-term and issued by government or local companies.
- Balanced funds: are funds that aim to provide a balanced mixture of safety (risk a little), capital, and income. Think investment funds balanced on the Applied investment strategy in the equity and fixed income, the balanced fund, the model contains a 60% equity, 40% fixed income, but it is possible to achieve a balance when the maximum or minimum of the asset value.
- International funds: are investment funds also known as with the title global funds or foreign funds, are often used by investors who invest their money outside their country of origin, and depend these funds on the application of exceptions in all over the world, often suffer from the difficulty in the classification of own funds; it is possible to increase the gravity or the proportion of security more from special funds, domestic investments; they tend to be more change as a result of many factors such as the effects of the political.
- Specialized funds: are more investment funds comprehensive; they contain more of a class of securities that are considered most popular, but the use of these funds for development in the categories within the sector of the economy, it drains money of sector-specific economic, such as health, finance, technology which are more likely to achieve the profits, and the types of these funds:
- Regional funds: are funds that take care of applying investment within a specific area; i.e., the focus is on a particular place, such as provinces or states, these funds are easily used in investments that depend on buying foreign shares.
- Social funds: also known under the name of the funds ethical, depend on the application to investment in companies that meet the standards of specific investment and of the association in the morality; do not invest money in arms companies or alcoholic beverages.
- Index funds: are funds that are interested in investing in the indicators numbers, include the results of equity in financial markets, characterized by the index funds as low risk.