What are equity investment funds?

Equity investment funds are collective investment products that invest most of their capital in equities. A fund is considered an equity fund if exposure to this type of asset is 75% or higher.

Shares of listed companies are the most well-known equities. Other examples include currencies, commodities, preference shares, convertible bonds or investment funds themselves.

The main characteristic of equity funds is that you do not know what their future return will be when you subscribe the fund, and there is no guarantee that the invested capital will be returned. As a consequence, their risk is greater than the risk of fixed-income funds, albeit they tend to show more potential for generating more attractive returns.

Categories of equity investment funds

Equity funds are divided into different categories depending on the market or geography where they invest in (Spain, eurozone, USA, emerging countries, etc.), their investment styles (Growth or Value) or their sectors (technology, financial, health, commodities, etc.). For example, depending on their exposure to currency risk, the National Securities Market Commission (CNMV) categorises them as:

  • Euro equities: at least 60% of the total exposure in equities is issued by entities based in the eurozone.
  • International equity: more than 75% of the total exposure in equities not classified as "euro equity".

Also, mixed funds include mixed equity funds, where exposure to equities is between 30% and 75% of the total asset portfolio.

If you wish to find out more about equities, go to the virtual classroom ("Aula Virtual") on Santander Asset Management's website, where you can also find our equity fund offerings.

You can find more information about equity funds and Mi Cartera Santander (My Santander Portfolio) on our website.


You might be interested in