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This article is more than 3 year old.

What are investment or fund companies

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These companies could be owned either by private or public entities who besides selling also handle and market funds in order to attract public.

What are investment or fund companies
There are institutions that deal with the business of investment.
Firms that engage in the activity of investing the capital in to the market are called investment or fund companies.
These companies could be owned either by private or public entities.  Besides selling, these firms also handle and market funds in order to attract public.
In addition to the above mentioned functions, according to Investopedia, the investment companies also carry out additional functions such as portfolio management, record keeping, custodial, legal, accounting and tax management services.
After pooling capital from various individuals for investment, the company also distributes a share of the profit or loss the investment had incurred to.
There are three types of investment companies, i.e. closed-end funds, open- end funds and unit investment trusts (UIT).
Open-end funds are offered either as mutual fund or exchange-traded fund. There will be no restrictions on the number of shares that can be issued by the company. Investors will have the option of taking back their investment at any point in time in these funds.
Close-end funds, on the other hand raises capital by issuing a fixed number of shares. However they are not redeemable and are traded like stocks. UITs are similar to mutual funds and its shares can be solved back at any time to the investment company.
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