Forex Education Center- Controversies in the storage of funds directly or through establishment of collective investment,the biggest advantage of investing in pooled funds are investors access to professional expertise and gain diversification of holdings within the fund. Investors also receive the services associated with these funds as regular written reports and dividend payments (where applicable). The major disadvantages of investing in pooled funds are payable to the managers of such funds (generally must be paid at the beginning and every year and sometimes on exit) and the diversification of the fund that may or may not match the background of the needs of the investors.
It is possible to over-diversify. If investors keep some funds, risk and structure of the overall position is an amalgam of storage in all the different funds and arguably the investors to an index or market risk estimates can be made.
Costs or fees paid to professional fund management organization should be monitored carefully. In many cases that is not good (such as fees and other costs which the fee is not visible and hidden in the work environment of the organization) is greater than the payment of dividends and profits after tax returns which investors expect in an average year.
Fundamental Analysis and Technical Analysis
In the effort to try to identify a good stock for an investment, there are two thoughts: technical analysis and fundamental analysis. The first one is done by studying the history of the stock price and the price history of the stock market as a whole; technical analysts have developed a variety of indicators, some of which are very complex, which is expected to provide useful information in terms of volume and price. Fundamental analysis is done by studying all the relevant information relating to the stocks and market conditions to try to look at the business outlook and future financial development / finance, including the movement of the stock price itself. Fundamental information studied include the financial statements, and any account, industry data (such as sales and order trends) and see the general economic and financial conditions (such as the trend of interest rates).
