3.07 Deep Dive into Funds

Instrukcije

Learning Objectives

Students will be able to:

Identify the differences between mutual funds, index funds, exchange-traded funds, and target date funds
Explain the advantages and disadvantages of investing in mutual funds, index funds, exchange-traded funds, and target date funds

National Standards for Personal Financial Education

Investing

6b: Discuss the pros and cons of investing in a diversified mutual fund versus investing in a small number of individual stocks
6d: Explain how target date retirement funds reallocate investments over time to meet their investment objective
7a: Discuss how the expenses associated with buying and selling investments can impact rates of return and investment outcomes
7b: Compare the expense ratios for several mutual funds
7c: Explain why an actively managed mutual fund usually has a higher expense ratio than an index fund
13c: Discuss the advantages of investing in an exchange traded fund (ETF) that tracks a market index rather than investing in actively managed mutual funds or individual stocks and bonds

5

PROMPT: 1 min
Use the space below to answer the prompt.
One common misconception about funds is that investors own shares of the stocks included in the fund. In reality, you only own shares of the fund itself. Does this influence your view of investing in stocks vs. funds? Explain why or why not.

Mutual Funds

Pros and Cons of Investing in Mutual Funds - Smart Asset
What are Mutual Funds and How to Invest in Them? - Investopedia

Index Funds:

What Is An Index Fund And How Does It Work? - Rocket HQ
Investing in Index Funds: What You Need to Know - Investopedia

ETF's

ETFs vs. mutual funds: Cost comparison - Fidelity
Exchange-Traded Funds - The Balance
Exchange-Traded Fund (ETF): How to Invest and What It Is - Investopedia

TDF's

Target-Date Funds - Nerdwallet
What Is a Target-Date Fund (TDF)? - Investopedia

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Use the resources on the left and others to fill out your section of the account type and be prepared to share with the class. Each group will present their research with the class and fill in the rest of the chart.

Each group will share their research to the class.

Everyone in your group should have the chance to present something about your fund.
Use the information from other groups’ presentations to fill out the rest of the table.

8

Part II: Which Investment Am I?
Match each description with its investment fund from the word bank below.

Stavka koja se može prevući		Odgovarajuća stavka
TDF		I am actively managed and usually come with higher fees.
Mutual Fund		I am passively managed and usually come with lower fees.
Index Fund		I can be bought and sold throughout the day.
ETF		I am best for beginner investors who want to build their retirement fund. I don't require a lot of work as an investor and am often referred to as a set-it-and-forget-it fund.

5

Learning Objectives

Learning Objectives

3.07 Deep Dive into Funds

Learning Objectives

Learning Objectives

PROMPT: 1 min
Use the space below to answer the prompt.
One common misconception about funds is that investors own shares of the stocks included in the fund. In reality, you only own shares of the fund itself. Does this influence your view of investing in stocks vs. funds? Explain why or why not.

PROMPT: 1 min

Part II: Which Investment Am I?
Match each description with its investment fund from the word bank below.

PROMPT: 1 min

Part II: Which Investment Am I?
Match each description with its investment fund from the word bank below.

Which of the four funds seems like a good investment option for you? Why? (Note: You can choose more than one.)

Which of the four funds seems like a good investment option for you? Why? (Note: You can choose more than one.)

3.07 Deep Dive into Funds

Learning Objectives

Learning Objectives

3.07 Deep Dive into Funds

Learning Objectives

Learning Objectives

PROMPT: 1 minUse the space below to answer the prompt.One common misconception about funds is that investors own shares of the stocks included in the fund. In reality, you only own shares of the fund itself. Does this influence your view of investing in stocks vs. funds? Explain why or why not.

PROMPT: 1 min

Part II: Which Investment Am I?Match each description with its investment fund from the word bank below.

PROMPT: 1 min

Part II: Which Investment Am I?Match each description with its investment fund from the word bank below.

Which of the four funds seems like a good investment option for you? Why? (Note: You can choose more than one.)

Which of the four funds seems like a good investment option for you? Why? (Note: You can choose more than one.)

PROMPT: 1 min
Use the space below to answer the prompt.
One common misconception about funds is that investors own shares of the stocks included in the fund. In reality, you only own shares of the fund itself. Does this influence your view of investing in stocks vs. funds? Explain why or why not.

Part II: Which Investment Am I?
Match each description with its investment fund from the word bank below.

Part II: Which Investment Am I?
Match each description with its investment fund from the word bank below.