Explain Three Considerations a Small Business Owner Should Keep in Mind

question 80

Essay

Explain three considerations a small business owner should keep in mind when choosing a lender or investor.

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Definitions:

Hedge Funds

Investment funds that employ diverse strategies to earn active return, or alpha, for their investors, often engaging in leveraged, speculative investment practices.

Mutual Funds

Financial investment strategies funded by contributors, trading in diversified assets and overseen by professional administrators.

Institutional Investors

Organizations or entities, such as pension funds, insurance companies, and endowments, that invest large amounts of money into securities and real estate.

Asset Allocation

The process of dividing investments among different asset categories, such as stocks, bonds, and cash, to optimize risk and return.