BALANCED FUND Meaning and
Definition
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A balanced fund, also known as a hybrid fund, is a type of investment fund that seeks to provide investors with a balance between growth and income. It aims to achieve this by investing in a mix of stocks, bonds, and other securities, diversifying the portfolio across different asset classes.
The key characteristic of a balanced fund is its equal allocation to both equities and fixed-income securities. By maintaining a balanced portfolio, it seeks to moderate some of the risks associated with investing in the stock market, while also offering potential for capital appreciation. This allocation provides stability and income potential, as fixed-income securities typically generate regular interest payments, and the equities contribute to long-term growth.
Investors primarily choose balanced funds for their ability to provide a diversified investment strategy that combines growth and income objectives. This makes them suitable for long-term investors looking for stability and consistent returns. The asset allocation within a balanced fund is typically determined by the fund manager, who seeks to rebalance the portfolio periodically to maintain the desired ratio between equities and fixed-income securities.
A balanced fund can be a suitable choice for investors with a moderate risk tolerance level, as it offers a lower level of risk compared to equity funds while still providing the potential for capital growth. By investing in a balanced fund, individuals can gain access to a well-diversified investment portfolio and benefit from the expertise of professional fund managers in managing the asset allocation and investment decisions.
Common Misspellings for BALANCED FUND
- valanced fund
- nalanced fund
- halanced fund
- galanced fund
- bzlanced fund
- bslanced fund
- bwlanced fund
- bqlanced fund
- bakanced fund
- bapanced fund
- baoanced fund
- balznced fund
- balsnced fund
- balwnced fund
- balqnced fund
- balabced fund
- balamced fund
- balajced fund
- balahced fund
- balanxed fund
Etymology of BALANCED FUND
The etymology of the word "balanced fund" is as follows:
1. Balanced: The term "balanced" in this context derives from the verb "balance", which comes from the Old French word "balancer" meaning "to swing back and forth" or "to weigh". It entered Middle English as "balancen" in the 14th century, which referred to the act of weighing or comparing things.
2. Fund: "Fund" comes from the Latin word "fundus", meaning "bottom" or "foundation". It initially referred to a sum of money set aside for a particular purpose. In English, "fund" was first recorded in the mid-17th century as a financial term denoting a sum of money or other resources.
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