Glossary Of Mutual Fund Terms
	Bear Market:
	A period when security prices have dropped 20% or more. Since World War II there have been only five Bear Markets.
	Bull Market:
	A period when security prices are generally rising.
	Compounding:
	Earnings on an investment's earnings. For example, if you invest $1000 at a rate of 5% per year, after one year your investment would be worth $1050. During the second year your investment earnings are based on the original investment plus the $50 in first year earnings assuming they remain in the account.
	Diversification:
	Spreading investments broadly across a number of securities, sectors or asset classes to reduce risk.
	Dollar Cost Averaging:
	Investing a fixed amount periodically, (i.e. $1,000 per month) regardless of fluctuating price. This results in purchasing more shares when prices are low, and purchasing fewer shares when prices are high. Hypothetically this strategy results in a lower average share cost.
	Net asset value:
	A mutual fund share's value, calculated once each day, based on the closing market value of the funds portfolio. It is computed by deducting the fund's liabilities from the portfolio's total assets and dividing this amount by the total number of shares outstanding.
	Risk/Reward Tradeoff:
	The principal that an investment with higher return potential typically has higher potential risk associated with it.
	Sales Load:
	The amount added to a mutual fund share's net asset value to arrive at the public offering price.
	Sector Fund:
	A mutual fund whose investment objective is to capitalize on the return potential provided by investing in a particular industry or sector of the economy.