Term
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Definition
| Type of investment fund that has a fixed number of shares. Purchasers and sellers of shares must trade with each other. |
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Term
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Definition
| Type of investment that stands ready at all times to sell investors new shares or buy back investors' old shares. |
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Term
| Net Asset Value (NAV, p.80) |
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Definition
| Way of valuing mutual funds. Is equal to the current value of the securities owned by the fund minus any liabilities divided by the number of shares outstanding. |
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Term
| Exchange-traded Funds (ETFs, p.81) |
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Definition
| Type of fund that is either a mutual fund or a unit investment trust. Began trading in 1993. |
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Term
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Definition
| Type of mutual fund that has a commission associated with the purchase of the fund shares. The commission may run to 5.5 percent or higher. |
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Term
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Definition
| Type of mutual fund that has lower sales charges usually around 2 to 3 percent instead of the usual 5 percent. |
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Term
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Definition
| Type of mutual fund for which there exists an exit fee in selling the fund. |
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Term
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Definition
| Type of mutual fund that does not charge commissions and is sold directly by the investment company through advertisements, prospectuses, and 800-number telephone orders. |
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Term
| Money market funds (p.89) |
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Definition
| Type of investment that invests in short-term securities, such as U.S. Treasury bills and Eurodollar deposits, commercial paper, jumbo bank certificates of deposit (CD), and repurchase aggreements. |
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Term
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Definition
| Type of investment that includes funds called aggressive growth funds and those concentrating on more stable and predictable growth. |
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Term
| Growth with income funds (p.89) |
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Definition
| Type of investment that has both growth and income as goals. |
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Term
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Definition
| Type of investment that combines investments in common stock and bonds and often preferred stock. |
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Term
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Definition
| Mutual funds that replicate a market index as closely as possible. |
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Term
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Definition
| Type of mutual fund that has bonds as the primary investment and provides a steady return. |
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Term
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Definition
| Type of funds that exist for such areas as energy, medical technology, computer technology, leisure, and defense. |
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Term
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Definition
| Type of mutual fund that invests in overseas markets and mandates investing on an international basis, within the markets of a particular locale, or within a region. |
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Term
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Definition
| Type of mutual fund that has specialized approaches that do not fit neatly into any of the other categories. |
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Term
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Definition
| Types of mutual funds that automatically adjust the risk profile of the fund as the investor gets older. |
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Term
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Definition
| Contains information deemed essential by the SEC in providing "full disclosure" to potential investors regarding the fund's investment objectives and policies, risks, management, and expenses. |
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Term
| Dollar-cost averaging (p.96) |
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Definition
| Investing method under which the investor buys a fixed dollar's worth of a given security at regular intervals regardless of the security's price or the current market outlooks in order to average the cost out over each stock. Some will be purchased when they are higher and some when they are lower. |
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Term
| Unit investment trusts (UITs, p.103) |
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Definition
| Investment companies organized for the purpose of purchasing a pool of securities--usually tax-exempt municipal bonds. |
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