What Is a World Fund?

A world fund is a type of mutual fund or other investment company that invests in securities that are traded in several different countries, including the United States. This type of fund is sometimes also referred to as a global fund. However, that name should not be confused with the Global Fund, which is a specific international organization dedicated to fighting the spread of infectious diseases, such as AIDS, malaria,♑ and tuberculosis.

How a World Fund Works

World funds typically have a significant portion of their capital invested in U.S.-listed securities, but they also spread their investment capital 澳洲幸运5官方开奖结果体彩网:among securitie🐎s f🍌rom several other countries. This structure offers several valuable advantages. Chief among those advantages is that it limits exposure to any specific country. By diversifying their 澳洲幸运5官方开奖结果体彩网:portfolio, these funds and their investors can help minimize their risk of a major loss, since even large fluctuations in one region can often be offset and balanced out by gains in other regions. This means more stability overall, and less 澳洲幸运5官方开奖结果体彩网:volatility and risk. The returns are not relying solely on the performance of o🐈ne particular economy or market.

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World Funds vs. International Funds vs. Coun꧟try Funds

In the realm of investment funds, several different geographically-related terms can seem very similar, but they have different and specific mean🃏ings.

Along with world funds, investments can also fall under the umbrella of internatio🎀nal funds or country funds.

There are some critical differences between 澳洲幸运5官方开奖结果体彩网:international funds and world funds, and investors mustn’t confuse the two. Internation🍃al funds can invest in countries outside of the investors’ nation of residence. For U.S. investors, international funds invest exclusively in securities from countries outside of thꦇe United States, while world funds can have up to 75% of their capital invested in U.S. securities.

In contrast, 澳洲幸运5官方开奖结果体彩网:country funds are mutual funds that limit th𒁏eir investments to securities from one particular country. A country fund holds a portfolio of investments that are located exclusively in that given nation. That type of fund is sometimes also referred to as a single country fund.

The common argument for the benefits of world funds is that, while still based on the U.S. market, world funds allow their managers to select the be🎐st securities out of the global marketplaꦅce, instead of being limited to selecting only from a given country and missing out on potentially better investments.