In today's sophisticated investment world,
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By using this strategy, investors can amplify their returns for the same outlay of investment dollars and so accelerate their portfolio's growth.
The Rydex and ProFunds Families offer what are commonly known as enhanced index funds. Like regular mutual funds,
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moncler, Dow Jones Industrials and S&P 500. But they also invest in derivative products like futures contracts and Equity Index Swap Agreements to leverage their returns and provide gains or losses that equal 200% of the underlying index.
Enhanced index fund investing is a sophisticated strategy that can significantly magnify your returns when used in conjunction with proper money management and a robust trading system.
Enhanced Index Funds Explained
The two categories of Enhanced Index Funds are commonly known as "bull" funds and "bear" or "short funds." When buying a bull fund,
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Enhanced index funds allow the investor to increase gains in both up and down markets because of their ability to return 200% of the underlying movement of the index.
Therefore,
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Potential Advantages of Enhanced Index Funds
--Double the gains of the underlying index in both up and down markets
--More market exposure without increased investment cost
--Can be used in qualified retirement accounts to short the market which can't be done with most other shorting vehicles
Potential Disadvantages of Enhanced Index Funds
--Leverage will maximize losses if invested on the wrong side of the market
--Increased volatility due to derivatives
--May not be suitable for all investor
--Lack of flexibility; cannot be traded during trading day; end of day pricing
--Tracking error; enhanced index funds may vary from underlying benchmark and so may not deliver 200% returns in relation to underlying index
Are Enhanced Index Funds Right for You?
Enhanced index funds are suitable for investors who seek an aggressive investment tool and who want to outpace the potential gains of the underlying index.
They offer the investor greater exposure and potential profits without an additional cash outlay and so allow the investor to maximize returns.
Before utilizing enhanced index funds,
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franklin marshall, enhanced index funds can be a valuable and profitable addition to your portfolio. [返回上一页] [打 印]相关的主题文章:
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