Mogul777, I will be sure to read the prospectus again before signing anything and my FA has read it over to me. My FA probably assumed I understood that mutual funds change daily but I didn't and I didn't think of asking until after. On a side note, does it make you feel smart by coming online and trying to make other people feel stupid? I am relatively new to investing and have done lots of reading but this was unclear to me.
As noted upthread, mutual funds may buy & sell daily. Index mutual funds track a specific index, like the S&P500 or TSX Composite, so they tend to have low portfolio turnover. Actively managed funds choose holdings to try to get good performance, but do not track any specific index. Active funds may have low to very high portfolio turnover depending on the manager and the fund mandate.
One potential issue with actively managed mutual funds is they have a vague investment mandate that allows a broad range of holdings and tactics, so the fund may change over time with no requirement to notify investors unless it is a very significant change. If you don`t want the fund manager to have that leeway, consider index mutual funds or ETFs instead.
Mutual funds are required to publish their holdings. I`m not totally sure but I think they must disclose the top 25 holdings every quarter.
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