Asset Size

AAA

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.

INVESTOPEDIA EXPLAINS 'Asset 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.

RELATED TERMS
  1. Economies Of Scale

    The cost advantage that arises with increased output of a product. ...
  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. Historic Pricing

    A method for calculating the value of an asset using the last ...
Related Articles
  1. Mutual Funds & ETFs

    Mutual Funds: Does Size Really Matter?

    The growth of mutual funds isn't always cause for celebration. Read on to find out why.
  2. Mutual Funds & ETFs

    How To Pick A Good Mutual Fund

    Learn how to evaluate mutual funds and find the right one for you.
  3. Mutual Funds & ETFs

    Mutual Funds Are Awesome - Except When They're Not

    This investment is very popular, but that doesn't mean it comes without risk.
  4. Mutual Funds & ETFs

    Pick The Winners At The Mutual Fund Track!

    For both mutual funds and racehorses, there's no surefire way to pick a winner.
  5. Mutual Funds & ETFs

    Five Janus Mutual Funds With High Alpha

    A look at some of the alpha-generating equity funds from Janus.
  6. Mutual Funds & ETFs

    The Impact of the Janus Market Timing Ruling

    A look at the impact of the Janus Supreme Court ruling on market timing.
  7. Mutual Funds & ETFs

    Why Mutual Funds Lose Their Five-Star Ratings?

    Ratings help people feel confident about their decision before purchasing. Morningstar’s rating system helps people to find and invest in mutual funds.
  8. Mutual Funds & ETFs

    PIMCO vs. BlackRock: Weighing Mega Fund Managers

    A look at the world's biggest bond manager and the world's largest asset manager.
  9. Professionals

    Are Alternative Mutual Funds, ETFs Right for You?

    Alternative mutual fund and ETFs are gaining popularity but are they a good idea for your regular Joe investor?
  10. Investing

    Active Funds: Getting What You Are Paying For?

    Fund investing could have hidden costs that can potentially make a big impact on your final return, particularly over the long-term.

You May Also Like

Hot Definitions
  1. Fixed-Charge Coverage Ratio

    A ratio that indicates a firm's ability to satisfy fixed financing expenses, such as interest and leases. It is calculated ...
  2. Efficiency Ratio

    Ratios that are typically used to analyze how well a company uses its assets and liabilities internally. Efficiency Ratios ...
  3. Fixed Cost

    A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses ...
  4. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  5. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  6. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
Trading Center