Mutual Fund

Since 1990, Investment on Mutual Funds from Americans had outreached U$D 4.5 trillions, far over than bank deposit, nowadays, the mutual funds are already American’s main course.

Asking professional to invest money for you by mutual funds, it’s just to unite all small investor’s money into a fund (as one big investor), which is administrated by a professional fund manager or by a professional organization, through theirs experienced knowledge to take the investment decisions and directions, then investors can achieve a kind of investment’s asset model.

Basing on American Securities and Exchange Commission (SEC)’s rules, the responsible for fund collecting must be registered at SEC, also must have 100 investors as members and, at least, to have U$D 100.000 of asset.

Managing and administration power are separated

In the practical process way saying, the mutual fund is divided into 3 main parts: first it’s the person who is benefited by fund, the investor who put the money into the fund, second one, it’s the fund management company, this one has the task to invest and calls the way how the fund will be invested as decision maker, finally, the last one, its administration organization, responsible for keep the fund’s money also for asset allocation’s job. Under this process model, the fund manager it’s responsible for fund investment and trading job, the fund’s asset do not pass on its hands, the investors money are all deposited in the administration organization as an independent account, its safe also secure, when fund investor transfer the money to fund manager, then he/she has to accept the result of winning or loosing.

Professional Investment Management

Invest in mutual fund can solve the most part of general people’s time and professional’s knowledge limitation’s problems. Mutual fund manager owns rich experience and deep knowledge background, plus his accessibility from many company’s practical information, naturally, he is more capable to make the correct investment strategies.

Diversifying Investment Risk

Another good point about mutual fund it’s his multiple investment way. Above all, the fund can be multi-directed into many smaller parts of many different investment’s tools, like stocks, bonds, etc… reaching the goal of to diversify the risk. As investor buys the mutual fund, actually, he is buying many kinds of stocks, so, easily, the investor can achieve the goal of diversify risks also diversifying investment

1 Year Return

In the past 12 months fund’s investment return.

3 Years Return

In the past 3 years fund’s investment return. Value Line uses annual return, and not the 3 years total return. The way to calculate this return is basing on year by years’ compound interest, then, the result will going to be 3 years return.

5 Years Return

In the past 5 years fund’s investment return. The way to calculate this return it’s same as 3 years return, for example, suppose any fund in the past 5 years got 50% of return, so the annual return rate is 8.3%, not 10%.

10 Years Return

In the past 10 years fund’s investment return. Same way to calculate 3 and 5 years fund’s investment return.

12b – 1Fee

Many fund company collect this fee for its previous sale and administrative costs, this fee is directly discounted on the net fund asset, so, the price of fund it’s already discounted from 12b – 1 fee. Law rules: Yearly 12b – 1 fee can not pass 1% of total net asset amount.

1987 Crash Performance

In 1987, from august to November, the fund performance dropped drastically.

Beta (β)

The capital asset pricing model shows that the risk from an individual paper is well represented by its beta value. In statistic’s term, beta tells us the tendency from a certain paper to vary with the group paper. If a paper or bond or stock, etc… has beta equals 1, then it means that this paper would vary the same way as market, if market goes up, he goes up, if goes down he goes down. Now, if a paper has beta less than 1, it means that paper will vary in less proportion to market, at the same way if the paper has beta superior than 1, this paper would vary more than market. Concluding, a risk taker person would choose beta more than 1, but remember, more return means more risk, on the contrary, a conservative person would take beta lower than 1.

Beta 3, 5, 10

Classified by the past 3, 5 or 10 years’ data records of beta value.

Alpha (α)

Comes from investments valuation’s estimative and its return math calculation, it includes fund risk and market behavior to get the estimative, it shows the difference between the real value (price) performance and the expected value performance. Alpha estimates after risk correction’s performance. Being more specific, during the process of performance estimative, beta (β) value brings into the index variation sensitive also the non-risk short term bond. For Example: let’s suppose a certain fund has beta 1.5, if the return rate indicates 10%, and with variation, the estimative return turning to 15%, but if the market rewards fund by 20%, then the value of alpha would be their difference. Value Line uses Alpha value as an annual indicator. When the relation between net value and others alpha value is low, and fund’s price undervalued, this is a good moment of choice for the most of investment. But, for some kind of fund, alpha value maybe will not have that such influence, for example, international kind of fund, metal industry fund, and others special kind of funds. These funds’ performances are not related to the S&P index, when the funds’ performances are low related to S&P changes, the alpha value can not be reliable.

Alpha 3, 5 and 10 years

Classified by the past 3, 5 or 10 years’ data records of alpha value.

As-of-Date

Information’s newest update date

Bear Market Performance

When fund’s performance / financial market it’s in decreasing.

Bull Market Performance

It’s when the market could change anytime; market will settle how long that performance would continuous.

Dividend Frequency

How many times a company pays his stocks’ reward yearly; could be one a year, every half year, every season or monthly.

Industries Sectors (Defined by Value Line)

Consumer durables, Energy, Metals, Pharmaceutics, Cycle Business, Non-durable consumption, Sales, Technology, Public business and Services; Services include: publicity, rent, impress, and others.

Cycle Business

Includes: Air transportation, construction material, chemical and plastic, electronic equipments, industrial machines and installation, steel, minerals and stones, packing and sealing, paper and woods, precious metals, environmental, railroads, ship transportation, forwarders, transportation installation.

Consumer durables

The durability includes as follow industries: clothes and leathers; automobile, tires, components and parts; construction; furniture and accessories; and others consumer durables.

Non-Durables

Includes: agro business, announcing, food, entertainment, home products, recreation and toys, hotels & association, publishing and restaurants.

Energy

The energy includes as follow industries: Power suppliers; oil, gas and natural gas.

Expensive Ratio

All expenses related to fund, include management fee, 12b – 1 fee and administrator’s fee, they are proportional to the net asset value.

Family Name

The name of fund Manager Company or organization

Finance

Includes these sectors: bank, any other finance company, federal currency exchange, insurance, real estate, stocks trading, and loans.

Fund Name

Mutual Fund’s full name

Health

Includes all Medicine & Pharmaceutics related industry. As medicine equipment, products, services, etc.

Inception Date

Mutual Fund’s first day public release’s date.

Investment Objective

Fund classification: Value Line’s mutual fund at total have 31 different kind and its separated in 6 main group: Stock Fund, Asset Fund, Foreign Stock Fund, Mix Fund, Fixed Return Fund, Tax free Fixed Fund.

Management Fee

Payment to Fund Manager’s administration fee (usually its indicated by the asset’s percentage.

Manager

Person who administrates the fund also set the investment structure.

Minimum Investment

It is the minimum amount of deposit from investor; usually the most part of fund set a minimum deposit of investment, also the minimum amount for transference. Beside those, others fund do not require minimum deposit, but previously set account’s automatic transferences or quitting account. Please to look up each fund’s detailed term to have more specific information.

Minimum Subsequent Investment

It’s the minimum amount to reinvest the same fund.

Fund’s Asset NAV

Mutual Fund’s each unit’s value, it also calls net asset value. This unit comes from the division between total net asset and the all released units, value line set the releasing date’s previous month’s last day as date of NAV, this means if the release day is 24th Feb. then the NAV date would be 31st. Jan.. Usually when an investor buys units of fund, he is actually paying the NAV also the adhesion process fee. For example: if NAV is U$D 10 and the adhesion process fee its 5%, then the total payment would be U$D 10.50