Mutual Funds Flashcard

Front

What is a mutual fund?

Back

An investment company that collects money from investors.

Front

List the two ways mutual funds are managed.

Back

Actively and passively

Front

Describe an actively managed mutual fund.

Back

Has a manager who decides how the fund’s money is invested

Front

What is the manager trying to beat in an actively managed mutual fund?

Back

The stock market’s average return

Front

Describe a passively managed mutual fund.

Back

Uses a computer to buy stocks and bonds

Front

What are passive funds trying to match?

Back

The stock market’s average return

Front

List two reasons passively managed funds have lower fees than actively managed funds.

Back

They don’t have to pay a fund manager and follow a buy and hold strategy.

Front

Explain the investment strategy that is called “Buy and Hold.”

Back

Buying stocks and holding them for a long period of time

Front

What are large cap funds?

Back

Mutual funds that invest in companies valued at more than $10 billion.

Front

Which of the following lists contains three large cap companies? Apple, Microsoft, Coca-Cola, Pepsi, Ford, IBM, Google, Amazon, Tesla, Samsung, Sony, LG

Back

Apple, Microsoft, Coca-Cola