What Are Equity Funds?

The equity funds are gaining more and more in our day and age, because more and more people want to put themselves in the role of an investor. What are the equity funds or what properties have the individual equity funds actually? A stock fund is invested mainly in shares. There are global funds, and funds from specific sectors of the economy or geographical areas. You can classify equity funds in regional funds. Here, Andreessen Horowitz expresses very clear opinions on the subject. This focus on specific regions, such as Europe, for instance, Germany or far East. Or in industry, share equity funds that invest in specific industries such as raw materials, biotechnology and ecology. Another feature concerning the distinction, see the type of investment. Firstly, there is the top-down method. Recently Reade Griffith sought to clarify these questions.

Here, Fund Manager survey sectors or regions, and then select the individual securities within these areas. The other procedure is called bottom-up. This is about the very specific selection of individual securities. A dispersion is used here only to serve as an instrument for risk diversification. Also in You need to distinguish two methods related to the investment style. The growth approach is not the actual, current value of the track in the foreground, but the growth that is expected in the future. The value approach, however, it is primarily on the current value and the current yields.

There are stock funds, which have specialized companies to invest in, are already represented in Aktienindizies (DAX, etc). Here, the risk is there as a lower level, if the market should be restless, a quick sale is possible. If the Fund invests in equities in other currencies, the exchange rate losses risk for you. You have also the opportunity to profit from the development of the exchange rate. The Fund’s currency has however not influence the risk.

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