Mutual Fund Sector or sectors are generally defined as an area of investment that is particularly and not necessarily classified in other areas or instances. There are 10 official or widely used areas of investment that have been identified and used in Canada by Canadians. This may differ from the U.S. and even foreign asset classes and sectors may also vary but the general principle is the same and that is to identify and classify different investment areas for the purpose and opportunity of diversification.
Mutual Fund Sectors are the general breakdown of where it is acceptable and understood that certain Mutual Fund Categories exist: mutual funds have been around in Canada since the early 60's and became very popular in the 80's soaring to a Mutual Fund Market high of 700 billion dollars in value. The Canadian capital markets are robust including the 85 mutual fund companies, investment fund firms and money management companies serving up over 4000 funds. The CIFSC.org a committee in the fund industry legislated to create, manage and maintain the fund categories and definitions.
Today there are 10 Asset Classes for mutual funds and 53 Mutual Fund Categories and some sub-categories to choose from and invest in. Finding the best or top funds in each asset class and or in each fund category has become the corner stone of advisor/client meetings. Once you see the Mutual Fund Flow Chart it makes more sense when understanding, studying and analyzing the flow of money within the mutual fund market. Asset Class - Mutual Fund Category - Mutual Fund Sector - and Mutual Fund Definition are clearly and purposefully assembled and lead to a natural conclusion of having greater, knowledge and control; perhaps enough to influence better results than an index or any average investor. Charting a course is smart having the leverage tools to change direction is important. The mutual funds category chart empowers the advisor and client to take more calculated risks to save and make and preserve more of their money.
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