TYPES OF INVESTORS |
| Credit: Harris Bricken |
• There are two types of Investors : Individuals and Institutions.
• Individuals are the single largest group in most markets, their portfolio size is very small and changes according to their life cycle.
• Institutions are representative organizations that invest capital on behalf of others. Assets managed by institutions are large.
MUTUAL FUNDS
• They are institutions that pool investors' money and invest according to pre-specified, broad parameters.
• These funds are managed and operated by professionals whose remunerations are linked to the performance of funds.
• The proceeds are then distributed among the investors after reducing management fees and commission.
PENSION FUNDS
• They are institutions and funds created either by employer or employee.
• Funds are contributed by the employers and employees during the working life of employees.
• They can be managed in House or through some financial intermediary.
ENDOWMENT FUNDS
• They are generally non-profit organizations that manage funds to generate a steady return.
• Such funds are usually managed by charitable, educational, or non-government organizations.
• It is basically money invested to earn revenue to fund some charitable activity.
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