Tag: funds

Sponsor definition explanation

What is Sponsor?
1. In the context of stocks, an influential investor who creates demand for a security because of their positive outlook on it.

2. In the context of mutual funds, an underwriting company that offers shares in its mutual funds.

3. In the context of exchange-traded funds (ETFs), the fund manager or other entity who files the needed regulatory materials with the SEC to create an ETF. The sponsor also solicits and approves an authorized participant to create and redeem ETF shares. Read more for examples and further explanation including related video clips and also comments
Continue reading “Sponsor definition explanation”

Federal Home Loan Bank System – FHLB definition explanation

What is Federal Home Loan Bank System – FHLB?
An organization created by the Federal Home Loan Bank Act of 1932 to increase the amount of funds available for lending institutions who provide mortgages and similar loan agreements to individuals. This system was created in response to the depressive economic conditions of the era, which had impaired the U.S. banking system.

Also referred to as the “”FHL Bank System””. Read more for examples and further explanation including related video clips and also comments
Continue reading “Federal Home Loan Bank System – FHLB definition explanation”

Pension Plan definition explanation

What is Pension Plan?
A type of retirement plan, usually tax exempt, wherein an employer makes contributions toward a pool of funds set aside for an employee’s future benefit. The pool of funds is then invested on the employee’s behalf, allowing the employee to receive benefits upon retirement. Read more for examples and further explanation including related video clips and also comments
Continue reading “Pension Plan definition explanation”

Unit Investment Trust – UIT definition explanation

What is Unit Investment Trust – UIT?
An investment company that offers a fixed, unmanaged portfolio, generally of stocks and bonds, as redeemable “”units”” to investors for a specific period of time. It is designed to provide capital appreciation and/or dividend income.

Unit investment trusts are one of three types of investment companies; the other two are mutual funds and closed-end funds Read more for examples and further explanation including related video clips and also comments
Continue reading “Unit Investment Trust – UIT definition explanation”

Premium To Net Asset Value definition explanation

What is Premium To Net Asset Value?
A pricing situation that occurs when the stock value of a closed-end mutual fund is trading at a premium to the net asset value (NAV) of its components. The premium arises from the optimistic sentiment of investors toward the fund, which may be due to excellent management and investment strategies. Read more for examples and further explanation including related video clips and also comments
Continue reading “Premium To Net Asset Value definition explanation”

Load definition explanation

What is Load?
A sales charge or commission charged to an investor when buying or redeeming shares in a mutual fund. The fee may be a one-time charge at the time the investor buys into the mutual fund (front-end load), when the investor redeems the mutual fund shares (back-end load), or on an annual basis as a 12b-1 fee. Read more for examples and further explanation including related video clips and also comments
Continue reading “Load definition explanation”