Style (Investment)

Posted in Finance, Accounting and Economics Terms, Total Reads: 218

Definition: Style (Investment)

Style is the investment objective or approach which a fund manager would use for making choices in the selection of securities for the portfolio of fund. While there are a lot of styles, there are basic 9 investing styles for both kinds of funds equity and fixed-income. For the stock funds, size and value/growth of the company determine the style. For bonds, maturities and credit quality define style.



The size parameters specific for stocks are small-sized, medium sized and large sized companies that are determined by market capitalization. Value/growth blends or Value and growth individually are the 3 basic categories for stocks.


Bond maturities are categorized as long term, short term and intermediate term. Quality of credit quality is determined by the status of bond as a government or agency issue (high) while credit ratings for municipals and corporates of 'AAA' till 'AA' (high), 'A' till 'BBB' (medium) and 'BB' till 'C' (low).



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