An investor is basically a person who allocates assets with the intention of securing an asset or gaining an edge in the stock market. Most often the investor buys some specific species of real estate through a private sale. A number of investors make use of instruments to transfer their assets such as stock, bonds, mutual funds and so on. This transfer of ownership is done with the consent of the owner. Investors also make use of financial vehicles like bank deposit and commercial mortgage. Wfmj. Some Facts About Mutual Fund Swinging Now let us have a look at the concept of mutual fund switching. This is an investment process where the value of the shareholder’s portfolio is diluted by the added value of other invested companies. A number of fund managers in developed countries are willing to swap the portfolios of the investors in return for some shares of their assets. However, this process does not work well for all types of investors. If the total assets are small and the total returns are low, the efficiency of this transaction will not be able to compensate for the lost profits from the added dilution of value. Inefficiency such as the ones mentioned above are primarily caused by the lack of efficient management and poor financial strategies by the management company. An investor needs to be highly informed before he/she starts investing to prevent such inefficiency from affecting his wealth. Learning from experience and through education also help to understand the risks involved and how one can minimize the risk. One of the easiest ways to avoid the risk associated with mutual fund switching is to diversify one’s investments. Diversification not only decreases the risk of loss but it also ensures that you are making some money even if your investments perform poorly.