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Glossary · PSX term

Mutual fund.

A mutual fund pools money from many investors to buy a managed portfolio of assets.

Definition

An asset management company invests the pool in stocks, bonds, or money-market instruments according to the fund's stated objective, and you own units rather than individual shares. It offers diversification and professional management for a fee.

Worked example

Buying units of an equity mutual fund gives you exposure to many PSX stocks through one investment.

Related on PSX Clarity

Net Asset Value (NAV)

Exchange-Traded Fund (ETF)

Asset Management Company (AMC)

More glossary terms

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Market capitalization

Market capitalization is the total market value of a listed company. It is calculated by multiplying share price by shares outstanding and helps investors compare company size.

Market breadth measures how many stocks are rising versus falling, beyond just the index level.

Market sentiment

Market sentiment is the overall mood of investors toward the market, ranging from fearful to greedy.

A market halt is a temporary, exchange-wide pause in trading triggered by a large index move.

A market order buys or sells immediately at the best available current price.

Margin financing

Margin financing lets you buy shares using borrowed money, putting up only part of the value yourself.

A margin call is a demand to add funds when your leveraged position loses value past a limit.

Material information

Material information is any fact that could reasonably influence a stock's price or an investor's decision.

Margin of safety

Margin of safety is the gap between a stock's estimated intrinsic value and a lower price you pay.