Portfolio Management - Mutual Fund Resarch Paper

PORTFOLIO MANAGEMENT

What Does Portfolio Management Mean?

The art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against. performance.

Portfolio management is all about strengths, weaknesses, opportunities and threats in the choice of debt vs. equity, domestic vs. international, growth vs. safety, and many other tradeoffs encountered in the attempt to maximize return at a given appetite for risk.

Investopedia explains Portfolio Management

In the case of mutual and exchange-traded funds (ETFs), there are two forms of portfolio management: passive and active. Passive management simply tracks a market index, commonly referred to as indexing or index investing. Active management involves a single manager, co-managers, or a team of managers who attempt to beat the market return by actively managing a fund's portfolio through investment decisions based on research and decisions on individual holdings. Closed-end funds are generally actively managed.

INVESTMENT MANAGEMENT

The provision of 'investment management services' includes elements of financial statement analysis, asset selection, stock selection, plan implementation and ongoing monitoring of investments.

PRIVATE BANKING

The term "private" refers to the customer service being rendered on a more personal basis than in mass-market retail banking. It should not be confused with a private bank, which is simply a non-incorporated banking institution. The word "private" also alludes to bank secrecy and minimizing taxes through careful allocation of assets or by hiding assets from the taxing authorities.

Example is hsbc ranked 5th having high net worth of $379billion.

MUTUAL FUND

A mutual fund is a professionally managed type of collective investment that pools money from many investors to buy stocks, bonds, short-term money market instruments, and/or other securities

Mutual fund

A mutual fund is a professionally managed type of collective investment that pools money from many investors to buy stocks, bonds, short-term money market instruments, and/or other securities.[1]

Contents

[hide]

* 1 Overview

o 1.1 Advantages of mutual funds

o 1.2 Disadvantages of mutual funds

* 2 History

* 3 Leading mutual fund complexes

* 4 Types of mutual funds

o 4.1 Open-end funds

o 4.2 Closed-end funds

o 4.3 Unit investment trusts

o 4.4 Exchange-traded funds

* 5 Investments and classification

o 5.1 Money market funds

o 5.2 Bond funds

o 5.3 Stock or equity funds

o 5.4 Hybrid funds

o 5.5 Index (passively-managed) versus actively-managed

* 6 Mutual fund expenses

o 6.1 Distribution charges

 6.1.1 Front-end load or sales charge

 6.1.2 Back-end load

 6.1.3 12b-1 fees

 6.1.4 No-load funds

 6.1.5 Share classes

o 6.2 Management fee

o 6.3 Other fund expenses

o 6.4 Shareholder transaction fees

o 6.5 Securities transaction fees

o 6.6 Expense ratio

o 6.7 Controversy

* 7 Definitions

o 7.1 Net asset value or NAV

o 7.2 Average annual total return

o 7.3 Turnover

* 8 Further reading

* 9 See also

* 10 References

[edit] Overview

In the United States, a mutual fund is registered with the Securities and Exchange Commission (SEC) and is overseen by a board of directors (if organized as a corporation) or board of trustees (if organized as a trust). The board is charged with ensuring that the fund is managed in the best interests of the fund's investors and with hiring the fund manager and other service providers to the fund. The fund manager, also known as the fund sponsor or fund management company, trades (buys and sells) the fund's investments in accordance with the fund's investment objective. A fund manager must be a registered investment advisor. Funds that are managed by the same fund manager and that have the same brand name are known as a "fund family" or "fund complex".

The Investment Company Act of 1940 (the 1940 Act) established three types of registered investment companies or RICs in the United States: open-end funds, unit investment trusts (UITs); and closed-end funds. Recently, exchange-traded funds (ETFs), which are open-end funds or unit investment trusts that trade on an exchange, have gained in popularity. While the term "mutual fund" may refer to all three types of registered investment companies, it is more commonly used to refer exclusively to the open-end type.

Hedge funds are not considered a type of mutual fund. While they are another type of commingled investment scheme, they are not governed by the Investment Company Act of 1940 and are not required to register with the Securities and Exchange Commission (though many hedge fund managers now must register as investment advisors).

Mutual funds are not taxed on their income as long as they comply with certain requirements established in the Internal Revenue Code. Specifically, they must diversify their investments, limit ownership of voting securities, distribute most of their income to their investors annually,