Asset Size


DEFINITION of 'Asset Size'

The total market value of the securities in a mutual fund's portfolio. Total assets or total net assets are also used to describe a fund's size.


When it comes to the size of a mutual fund, bigger is not necessarily better. The key to a fund's investment quality, in terms of the amount of money under management, lies in the compatibility of a fund's asset size and its investment style.

So-called "asset bloat" is not much of a problem for bond, index and money market funds, which generally operate in large market segments that are very liquid and are less affected by large block trading transactions. With these funds, bigger is actually better because expenses can be spread over more investment assets.

However, if a managed stock fund gets flooded with new money, the investment managers may find it difficult to invest it in an efficient manner. As fund assets rise, the number of appropriate new stock prospects shrink and transaction costs increase, which makes maintaining the fund's investment style difficult.

  1. Economies Of Scale

    Economies of scale is the cost advantage that arises with increased ...
  2. Net Asset Value - NAV

    A mutual fund's price per share or exchange-traded fund's (ETF) ...
  3. Open-End Fund

    A type of mutual fund that does not have restrictions on the ...
  4. Net Asset Value Per Share - NAVPS

    An expression for net asset value that represents a fund's (mutual, ...
  5. NAV Return

    The change in the net asset value of an exchange-traded fund ...
  6. Benchmark

    A standard against which the performance of a security, mutual ...
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