A focused fund is a type of mutual fund that is smaller in scope and less diversified than some of its mutual fund brethren. Like a focus on tech companies, or emerging national markets, or currencies, or companies with fat dividends...
For the most part, focused funds tend to only hold stock in about 30 companies or fewer. Compare this to your standard mutual fund, which can have company positions in the hundreds. They also tend to only focus on a few market sectors instead of a wide range.
The result is that focused funds tend to be more volatile, since they aren’t diversified enough to absorb fluctuations in one or two market sectors. But the upshot runs that, since the fund is so, you know, focused, a lot more time and attention is put into making sure each investment is as solid and potentially profitable as can be.
Or at least that's the marketing pitch from the people who manage and sell it.
Related or Semi-related Video
Finance: What is a Sector Fund?5 Views
Finance allah shmoop What is a sect or fund All
right Well star wars and star trek captains are all
these barking about setting coordinates for sector for stat or
whatever they say That means urgent in the future right
We'll hear space here's sector four and it's Ah well
kind of a slice of space Ok now come back
to earth gently And as it applies to mutual funds
it's kind of the same notion that is A sector
comprises a particular discipline of investing Like think of it
like a slice of the s and p five hundred
Like one sector of the economy is banking Another is
tech Another is telecommunications And then there's oil and transport
And consumer durables in each of these areas has hundreds
of ways in which investors can invest in that particular
sector That is there are index funds that invest in
it Yeah Mutual funds hedge funds private equity funds Even
venture capital funds Each of whom has a particular discipline
or focus on lee in one sector More less so
why would you want to sector fund Well if you
believe that oil was about tohave an explosion in demand
the good kind of explosion Then you'd want to beam
or exposed to it financially at least to its upside
Then say you would technology which you feel has gotten
too expensive in the markets And its best days are
behind it It's A little like putting several of your
eggs into one particular basket because you really like that 00:01:30.519 --> [endTime] basket
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