During the course of history the development of financial markets around the world has been a permanent task to fulfil, thus creating important and varied elements such as mutual funds, which have greatly collaborated in the conception of this objective. Mutual funds can be defined specifically as the heritage formed or composed of a number of specific persons no matter they are natural or legal persons, with the sole and exclusive purpose of devoting such resources to investment, whether in a private or public entity and at the same time generating income from such investments. The main objective of mutual funds is the conception or investment in items such as bonds or stocks in order to generate participation in various entities at the same time. The purchase of bonds and stocks by mutual funds is an activity which are based most of their activities, the conception of these same is made with previous study; as one of the main qualities that have the mutual fund is the analysis of investment risk in a business or entity, which after becoming of decides the amount of actions that should be taken in that undertaking; It is good to mention everything depends directly of mainstream investors or Fund, as they are they who decide if they invest after the study of risk or capital said no. An important aspect to play in mutual funds is the profitability that they give to their investors, because the profits they produce are based to call it somehow, in the sale of shares acquired to a higher economic value to which were obtained; However the proper development of this activity is clearly related to the stock market, because according to the valuation of an entity actions may vary their prices radically.
It is very important to highlight the usefulness of mutual funds in a country’s economic growth, since to create with great success the investor entities has been achieving various economic objectives of each of the countries where they operate, not to mention that at the same time they promote business growth directly contributing to the interest that might raise in other mutual funds in other countries, this helping to rebalance the economy not only business but also state. Like all financial movements mutual funds possess certain advantages and disadvantages; among the most important we find some as: advantages. It is a very effective way of save and generate revenue at the same time. It has a great return. Access to a mutual fund is relatively easy, since the input amount depends directly on ourselves. The recovery of the invested funds is made very quickly. You can invest in a lot of financial fields at the same time.
Disadvantages. There is some risk to a loss if you don’t know investing. The investor must assume certain financial expenses as commissions for sales; among others. The price of the shares of the mutual funds directly depends on their assets, this became known after the close of the stock market; contrary to as happen in the case of the individual investment. Although more are the advantages and disadvantages that have mutual funds, those mentioned above are the most significant to take into account when we decide to participate in a mutual investment institution.