Mutual Funds, ETFs , and Pension Funds

This chapter examines a general classification of mutual funds as open-end versus closed-end, and as no-load versus load funds. It discusses specific types of funds. These include: money market funds, gilt funds, debt funds, diversified debt funds, focused debt funds, high yield debt funds, debt funds and bond duration, equity funds, aggressive growth funds, growth funds, specialty funds, sector funds, offshore funds, small cap equity funds, and option income funds. The exchange-traded feature of an Exchange-Traded Fund (ETF) offers many advantages to the investors. Shares of an ETF can be used for both margin trading and short-selling, as with conventional stocks. Pension funds in the United States are essentially financed by contributions by the employer. Plans that are given tax exemption are called qualified pension plans. There are two basic and widely used types of plans: defined benefit plans and defined contribution plans.