If you are aware about your investing decisions, you just may find yourself wondering what a financial advisor does.
Mutual funds, hedge funds, Roth Iras, and a host of other financial jargon are the norm when it comes to financial advisors. These are the professionals who advise everyday people on the best and wisest ways to invest their money.
These advisors fit in to three categories, they are: fee based, fee only or commission only. The distinction lay in whether or not they charge a flat fee for services (fee only), charge an asset based fee (fee based) or collect a commission for the brokering of financial products (commission only). Regardless of the category in which the advisor may be in, these professionals not only give financial advice, they also manage the finances for both individuals and companies.
With regards to advantage management and retirement planning, the advisor helps clients maintain a sure stream of passive or active income. They understand the world of finance and work hard in order to meet the needs of their clients by ensuring that funds invested manifest remaining returns during multiple streams of income. This is where mutual funds may come in to play.
There are three types of mutual funds in which they would have a hand in managing. They are: open-end funds, unit investment trusts and closed-end funds. They would oversee an entire portfolio if their client invested in an open-end fund since these types of mutual funds sell shares to the public daily and a financial advisor would need to watch and see if they essential to buy back shares at the end of the day. Financial Advisor in Gujarat
Component investment trusts are a little different in that these are only issued to the public one time at the time of creation. So, unlike an open-end fund there is no need to have a financial advisor watching or managing this type of mutual fund because it is documented and firm at the time it is initially created.
The closed-end fund or third type of mutual asset is much like the unit investment trust in that it too issues shares to the public one time, however investors in this fund can only sell their shares to another investor; they cannot sell the shares back to the fund. Advisors are definitely needed to manage an investment portfolio that has a closed-end fund in it. Financial Consultant in Gujarat