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Funds
15 guides in Finabase Learn
- Closed-end fund A fund with a fixed number of shares that trade on an exchange, often at a premium or discount to the value of its holdings.
- Exchange-traded fund (ETF) A fund that holds a basket of assets and trades on an exchange like a stock throughout the day, usually tracking an index.
- Expense ratio The annual fee a fund charges as a percentage of assets, deducted from the fund's returns; 0.03% costs $3 a year per $10,000.
- Hedge fund A privately offered pooled fund for accredited investors that can use leverage, short selling and derivatives, usually with performance fees.
- Index fund A mutual fund or ETF that aims to match the return of a market index by holding its constituents, usually at low cost.
- Institutional investor An organization that invests large pools of money for others, such as pension funds, mutual funds, insurers and endowments.
- Inverse ETF An ETF designed to return the opposite of an index's daily move, using derivatives; it decays when held over volatile periods.
- Leveraged ETF An ETF that aims for a multiple, such as 2x or 3x, of an index's daily return; compounding makes long-run results diverge.
- Money market fund A mutual fund that invests in short-term, high-quality debt and aims to keep a stable value, used as a cash alternative.
- Mutual fund A pooled investment that buys a portfolio of securities and is bought and sold at its net asset value once a day.
- Net asset value (NAV) A fund's assets minus its liabilities, divided by its shares outstanding: the per-share value of what the fund holds.
- Passive investing Owning a whole market or index through low-cost funds and holding it, instead of picking stocks or timing trades to beat it.
- Real estate investment trust (REIT) A company that owns or finances income-producing real estate and must pay out at least 90% of its taxable income as dividends.
- Target-date fund A fund built around a retirement year that starts stock-heavy and shifts gradually toward bonds and cash along a preset glide path.
- What is an ETF? How exchange-traded funds work How an exchange-traded fund is built, how authorized participants create and redeem shares, why price tracks NAV, and the main ETF types to know.
Educational content, not investment advice. Finabase Learn explains how markets and tools work. It does not recommend any security or strategy, and examples are for illustration only. Investing involves risk, including the loss of principal. Rules and figures are for the United States unless stated and can change — check the cited source before you act.