The spelling of "managed fund" is fairly straightforward, with each word having a standard phonetic representation. "Managed" is pronounced /ˈmænɪdʒd/, with emphasis on the first syllable and the "g" sound pronounced like a "j." "Fund" is pronounced /fʌnd/, with emphasis on the first syllable and a short "u" sound. As the name suggests, a managed fund is a type of investment where a professional fund manager is responsible for selecting and managing investments on behalf of the fund's investors.
A managed fund, also known as a mutual fund or collective investment scheme, refers to a professionally managed investment vehicle that pools money from multiple investors to create a diversified portfolio of financial assets. It is operated by a fund manager or investment company with expertise in selecting and managing a range of securities, such as stocks, bonds, and other assets.
In a managed fund, individual investors purchase units or shares in the fund, which represent their proportionate ownership in the underlying securities. The fund manager makes investment decisions on behalf of the investors based on the fund's investment objectives and strategy. They conduct thorough research, analysis, and market assessments to identify suitable investments that align with the fund's goals.
Managed funds offer various benefits to investors, such as diversification, professional management, and liquidity. By pooling funds together, investors gain access to a broader range of assets that would be difficult or costly to attain individually. Fund managers utilize their expertise to actively monitor and adjust the portfolio, aiming to generate returns and mitigate risks. Investors can also buy or sell their units in the fund at prevailing net asset value (NAV), providing liquidity compared to directly investing in individual securities.
Managed funds come in different types, including equity funds, bond funds, money market funds, and hybrid funds. Each type has distinct characteristics and investment strategies tailored to specific investor preferences and risk tolerance.
Overall, a managed fund provides individuals, who may not have the time, expertise, or funds to create a diversified portfolio, an opportunity to participate in the financial markets and potentially achieve their investment goals.
The word "managed fund" combines two components:
1. Managed: The word "managed" is derived from the verb "manage", which dates back to the 16th century. It originated from the Italian word "maneggiare" and the Latin word "manūtigare", both meaning "to handle or control". "Manage" eventually emerged in English to refer to the act of directing, controlling, or administering something.
2. Fund: The word "fund" comes from the Latin term "fundus", meaning "bottom" or "foundation". In the 17th century, "fund" began to be used to describe a sum of money set aside for a specific purpose or investment.
Therefore, the term "managed fund" refers to a pool of money or capital that is handled, directed, and controlled by professional managers who make investment decisions on behalf of the investors.