A statistical measurement of dispersion about an average, which depicts how widely the returns varied over the past three years. Investors use the standard deviation of historical performance to try to predict the range of returns that are most likely for a given fund. When a fund has a high standard deviation, the predicted range of performance is wide, implying greater volatility. Standard deviation is most appropriate for measuring risk if it is for a fund that is an investor's only holding. The figure cannot be combined for more than one fund because the standard deviation for a portfolio of multiple funds is a function of not only the individual standard deviations, but also of the degree of correlation among the funds' returns. If a fund's returns follow a normal distribution, then approximately 68 percent of the time they will fall within one standard deviation of the mean return for the fund, and 95 percent of the time within two standard deviations.
The state in which the provider company (see Provider Company) is located.
The percentage of the fund’s assets invested in stock.
See Asset Allocation.
A subdivision of funds, usually with common characteristics as the category (see Category).
A plan offered by mutual funds that pays specific amounts to shareholders at predetermined intervals.