Issue: Mid-term assignment (40% of total grade)
Course: Financial Markets
Topic: Mutual Funds/Index Funds /ETFs /The nature of risk/Statistics on investment funds
Due:
Part 1
- What are Mutual Funds?
- What are Index Funds?
- What are ETFs?
- Compare carefully Mutual Funds, Index Funds and ETFs.
- Explain clearly what are the benefits and reasons for investing in a Mutual Fund, Index Fund and in a ETF.
- Investment companies attempt to explain to investors the nature of the risk the investor incurs when buying shares in their mutual funds. For example, go to https://investor.vanguard.com/mutual-funds/vanguard-mutual-funds-list?assetclass=bond
- Select the bond fund you would recommend to an investor who has very low tolerance for risk and a short investment horizon. Justify your answer.
- Select the bond fund or stock fund you would recommend to an investor who has very high tolerance for risk and a long investment horizon. Justify your answer.
Part 2
- What is the role of the financial institutions providing these investment funds in an economy.
- Statistics of the percentage of savings of a country’s population that goes into these investment funds (Indeed this information is country specific.)
- Statistics on the trend of total dollar amount that goes into these funds.
- Statistics on who are the largest providers of these funds.
- The statistical differences in return in comparing these three groups of investment funds
Instructions:
- Write a three to four pages long paper on answering briefly and professionally on the above topics.