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Fund Diversification

Fund Diversification

Mutual Fund "Diversification"

Diversified Funds: think 75-5-10. The Investment Company Act of 1940 has a bunch of rules, which define what mutual funds are and sets guidelines as to how they can behave and structure themselves. A diversified fund means that the fund is exposed to many areas. Energy, Telecommunications, the Consumer, Banks, Technology, etc.

In theory, a diversified fund is less volatile than a non-diversified fund. For a fund to qualify to be able to advertise itself as...

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