Temporary New Account

AAA

DEFINITION of 'Temporary New Account'

An account that is set up within a fund to hold a balance as a result of a significant cash inflow or outflow to a fund. The account is set up to hold these funds temporarily until they can be distributed to unit holders, used to acquire additional assets for the fund or for other large fund expenditures.

INVESTOPEDIA EXPLAINS 'Temporary New Account'

Temporary new accounts are set up by funds in order to help streamline and simplify the accounting and cash flow process. By setting up separate accounts, a fund can easily determine the amount of money that is going to be distributed to unit holders, or roughly the amount of money it will use to purchase additional holdings for the fund.

RELATED TERMS
  1. Hedge Fund

    An aggressively managed portfolio of investments that uses advanced ...
  2. Pension Fund

    A fund established by an employer to facilitate and organize ...
  3. Sector Fund

    A stock mutual, exchange-traded or closed-end fund that invests ...
  4. Mutual Fund

    An investment vehicle that is made up of a pool of funds collected ...
  5. Fund Manager

    The person(s) resposible for implementing a fund's investing ...
  6. Accident Year Experience

    Premiums earned and losses incurred during a specific period ...
Related Articles
  1. Retirement

    The Rise Of The Hedged Mutual Fund

    Discover these growing funds, which were previously unavailable to the average investor.
  2. Investing

    What is a mutual fund's NAV?

    Net asset value (NAV) represents a fund's per share market value. This is the price at which investors buy ("bid price") fund shares from a fund company and sell them ("redemption price") to ...
  3. Retirement

    When my mutual fund declares an income distribution, the fund price falls by a similar amount. How does ...

    An income distribution from a mutual fund to its shareholders can take two forms: A shareholder can elect to be paid directly, which puts the money in his or her pocket The shareholder ...
  4. Mutual Funds & ETFs

    What are the risks involved in keeping my money in a money market account?

    Setting aside funds in a money market account can be a safe investment strategy, but investors should be aware of the risks inherent to money market options.
  5. Mutual Funds & ETFs

    Does it make sense for me to have a money market account if I don't want to buy any securities?

    Saving funds within a money market account or mutual fund does not have to be limited to those wanting to buy or sell securities in the near future.
  6. Mutual Funds & ETFs

    How much of my total assets should I be keeping in my money market account?

    Investing a portion of total assets in a cash position such as a money market account provides investors access to funds in the case of an emergency.
  7. Fundamental Analysis

    What is the difference between profitability and profit?

    Calculating company profit and profitability are not one and the same, and investors should understand the difference between the two terms.
  8. Fundamental Analysis

    Should companies break out accounts receivables into subledgers?

    Find out why every company that sells on credit should break down its accounts receivable into individual customer subsidiary ledgers, or subledgers.
  9. Fundamental Analysis

    Are taxes calculated in operating cash flow?

    Learn how taxes are involved with the calculations for operating cash flow, and find out about the importance of operational cash flow.
  10. Fundamental Analysis

    What metrics can be used to evaluate companies in the forest products sector?

    Understand some of the best financial and equity valuation measurements that can be utilized to evaluate companies in the forest products sector.

You May Also Like

Hot Definitions
  1. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  2. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  3. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  4. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  5. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  6. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
Trading Center