Thematic funds
Thematic funds are well-diversified funds that invest in companies among sectors that fall under a provided theme. They put at least 80% of their money into stocks with a specific theme. An infrastructure theme fund, for example, will invest in stocks of companies related to a specific theme, such as cement, power, steel, and so on.
Treasury stock
Also known as reacquired stock, Treasury stocks are stock that is purchased back by the issuing company in order to reduce the amount of outstanding stock on the open market.
Reasons for stock repurchase
- In jurisdictions that treat capital gains more favourably, stock repurchases is a way of rewarding shareholders rather than paying dividends.
- To give boost to their stock, the Companies will sometimes repurchase their stock if they believe it is undervalued on the open market.
- Companies repurchase their stock to reduce dilution from employee incentive compensation plans.
- Another reason for stock repurchases is to protect the company from a hostile takeover.
- When shares are repurchased, they can be cancelled or held for future issuance.
Limits of treasury shares
- These stock holders are not entitled to receive a dividend
- These stocks have no voting rights
Trend following
It is a strategy that seeks to profit from long-term, medium-term, or short-term movements in various markets. Trend following traders do not attempt to forecast or predict specific price levels; instead, they simply ride the trend. These traders usually enter the market after the trend has “properly” established itself, betting that the trend will last a long time and thus foregoing the initial turning point profit. A market “trend” is the tendency of a financial market price to move in a particular direction over time. If the trend reverses, they exit and wait for the turn to become a trend in the opposite direction. If their rules indicate an exit, the traders exit but re-enter when the trend initiates again.
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