Investor Education

A mutual fund or investment company which, as a regular policy, "hedges" its market commitments. It does this by holding securities it believes are likely to increase in value and at the same time is "short" other securities it believes are likely to decrease in value. The sole objective is capital appreciation. This type of fund is highly aggressive.

Sometimes called junk bonds, high yield bonds are corporate bonds with low-grade investment ratings. They carry ratings below BBB by Standard & Poor's and Baa by Moody's Investor Service. Because of their lower ratings, they can be considered relatively risky investments.