What Are Funds of Funds?
Most mutual funds and exchange-traded funds (ETFs) pool money from many investors and professionally invest it directly in a variety of assets based on the specific fund's investment description. Funds of funds (FoFs), however, invest in other funds rather than investing in individual assets.
While FoFs can provide broader diversification than investing in a single mutual fund or ETF, they also come with the potential for higher fees and other risks. Here are some factors to consider before investing in FoFs.
When evaluating investment products, consider working with an investment professional to help determine the best way to reach your financial goals.
Source Fool.com
