On the negative side, investors in a mutual fund must pay various It remains unclear whether mutual fund management can reliably produce an increase in investment returns exceeding these fees and expenses.
Mutual funds were introduced to the United States in the 1890s. Early U.S. funds were generally closed-end funds with a fixed number of shares that often traded at prices above the portfolio The first open-end mutual fund with redeemable shares was established on March 21, 1924 as the Massachusetts Investors Trust. (It is still in existence today and is now managed
the taxable income is passed through to the investors in the fund. Funds are required by the IRS to diversify their investments, limit ownership of voting securities, distribute most of their income (dividends, interest, and capital gains net of losses) to their investors annually, and earn most of the income by investing in securities and currencies
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