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(a) Explain in details the objectives and strategies of a value fund and a growth fund in terms of Morningstars Style of Mut
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A. Growth Fund: A growth Fund invested in the stock of a company which is currently generating positive cash flows. The companies earnings per share are growing rapidly and it is above the industry average. The company is also looking for expansion of operation a reinvesting its cash flows in the company. They generally represent the Large-cap & upper mid-cap.

Value Fund: it is a fund which invests in stocks which are currently trading below its intrinsic value. It is considered as an undervalued stock by the market and investor. The characteristics of the stock are low PE ratio, low PB ratio and high dividend yield. It stocks are generally small-cap stocks.


B.
They do so by applying the techniques of the fundamental analysis of equity valuations.

After that by calculating the intrinsic value of the stock.

If intrinsic value is greater than the current market price, then such stock is considered as a value stock.

Generally,
The value stock will pay more dividend because growth stock will reinvest its dividend to accelerate it's growth and not pay it.


C. Large-cap companies are multi-national giants which has a very huge market capitalisation. On an average market capitalisation of 10 billion dollars or more, is considered as a large-cap company.

Small-cap companies growing businesses which has a small market capitalisation. On an average market capitalisation of small-cap companies is between $300 million to $2billion.


D. Cap refers to market capitalisation.

The market capitalisation of the company= number of shares outstanding x current market price of a company.

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