|
| The Shareholder Report |
| A mutual fund is required to provide shareholders with an annual report and semi-annual reports within 60 days after the end of the fund's fiscal year and 60 days after the fund's fiscal mid-year. That report offers detailed insight on fees, financials, performance, and investment holdings. |
|
| Of course, some reports are easier to read than others, and some have more marketing fluff than information. But every report should contain the following important items: |
|
| 1. Letter from the Portfolio Manager |
| This letter recaps the year, providing an overview of the economic and political conditions that affected the fund's performance. The manager also may discuss the investment strategies that helped or hindered performance. He or she may even include some forward-looking statements about anticipated future performance. |
|
| 2. Performance |
| In this section you'll find all the information you need to evaluate performance during the reporting period, such as the fund's returns, its capital gains, and a comparison of its performance against a benchmark (usually an index, such as the S&P 500). It also should contain a chart that shows the value of a hypothetical $10,000 investment since the fund's inception. |
|
| 3. Holdings |
| A list of what your fund owns and the value of those holdings at period end. Here you'll be able to find information on the fund's top holdings, how it is diversified across industries, and, if applicable, in which countries it has investments. This section will help you determine if the fund is right for you and is consistent with your risk-tolerance level. |
|
| 4. Expenses |
| Funds are required to disclose their expenses–both one-time sales loads (which you pay at the time of purchase) and ongoing expenses that cover the costs of administrating and managing the fund. This is an important section as expenses are deducted directly from fund returns. The report also should provide a hypothetical example to help you better understand the ongoing costs of investing in the fund. |
|
| 5. Financials |
| Here you'll find the fund's financial statements and its net asset value (NAV). The NAV represents the fund's per-share price. It also should include information about the frequency with which holdings were bought and sold during the reporting period. |
|
|
> Home
> Glossary > Support |
