Mutual funds types

Question

Mutual funds types

Accepted Answer

Mutual funds are investment vehicles that pool money from multiple investors to invest in a diversified portfolio of securities.

Mutual funds can be categorized based on their investment objective, such as equity funds, debt funds, hybrid funds, etc.
Equity funds invest primarily in stocks, while debt funds invest in fixed income securities like bonds and treasury bills.
Hybrid funds invest in a mix of equity and debt securities.
Index funds track a specific market index, such as the S&P 500.
Sector funds invest in a specific sector of the economy, such as technology or healthcare.
International funds invest in securities outside of the investor's home country.
Money market funds invest in short-term, low-risk securities like government bonds and commercial paper.
Target-date funds adjust their asset allocation based on the investor's target retirement date.
Fund-of-funds invest in other mutual funds rather than individual securities.
Load funds charge a sales commission, while no-load funds do not.
Expense ratios represent the annual fees charged by the mutual fund.
Mutual funds can be actively managed or passively managed.
Actively managed funds have a fund manager who makes investment decisions, while passively managed funds track a specific index.
Mutual funds provide diversification, professional management, and liquidity to investors.

Top Invesco Portfolio Administrator interview questions & answers