All Weather Fund

Definition of 'All Weather Fund'


A mutual fund that tends to perform reasonably well during both favorable and unfavorable economic and market conditions. This type of investment result is accomplished, in most cases, through portfolio diversification, by employing a combination of asset classes, and/or using a variety of hedging strategies.

Investopedia explains 'All Weather Fund'


In the universe of mutual funds, there is no formal "all weather fund" category. However, a number of fund types qualify for the moniker because of the nature of their portfolios and/or how they are managed.

For example, a simple balanced fund (stock and bond) with a 60% equity and a 40% fixed-income portfolio comes close to fitting the all-weather description. An asset-allocation fund (stock, bond and cash equivalents) will also qualify if the proportional representation of its asset classes falls into the moderate style.

More recently, long-short funds, which combine long and short stock positions that adjust to market conditions, appear to have potential for benefiting investors on the upside and protecting them on the downside of market moves.



comments powered by Disqus
Hot Definitions
  1. Ascending Triangle

    A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs.
  2. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  3. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  4. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
  5. Degree Of Financial Leverage - DFL

    A ratio that measures the sensitivity of a company’s earnings per share (EPS) to fluctuations in its operating income, as a result of changes in its capital structure. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in earnings before interest and taxes (EBIT).
  6. Jeff Bezos

    Self-made billionaire Jeff Bezos is famous for founding online retail giant Amazon.com.
Trading Center