Mutual funds

Posted on June 23rd, 2008 by admin, under Mutual Funds.

Mutual fund is a combined investment funds transferred to trust management company. Mutual fund itself is not a legal entity, it is so-called “property complex”, and indeed, is investment portfolio.

Investing money in mutual funds, investor actually enters into a contract with the management company and trust management becomes the owner of investment shares. Management Company extradites shares, making this trust management of mutual funds.

The assets transferred into mutual funds by shareholders, remains the property of shareholders and management company is implementing trust management of mutual funds, making transactions with that property.

The Management Company is entitled to transfer their rights and responsibilities for managing mutual funds to another management company.

No Comments

Sructure of investment process

Posted on June 20th, 2008 by admin, under Structure of investment process.

Investment process is a mechanism of bringing together of investors (having temporally free funds) and sellers of financial instruments (actions, bonds) – having needs for money. It is possible on stocks.

Financial markets is a mechanism, taking together “sellers” and “buyers” by means of mediators (exchange stocks). There are a several types of financial markets - stock market, bonds, market of futures and options.

Investors participate in financial operations on markets both directly and through “financial institutes” – banks, insurance and pension companies (funds), investment funds.

The most important participant in financial markets is, as a rule, state - as a seller of government bonds, as investor (placing temporarily free funds) and as a regulatory organ.

Companies typically act as nets-borrowers. Private individuals supply considerable part of free funds to the market in order to get profit.

No Comments