Exchange Fund

Exchange Fund is a stock fund which allows an investor to exchange their large holding of the single stock for units within a portfolio. Exchange fund provides investors having a easy way in order to diversify their holdings, even though deferring any fees from capital gains. An Exchange Fund or Swap Fund is a mechanism specific to the U.S., first introduced throughout late 1960s which allows holders of lots of a single share to diversify in to a basket of different stocks without right selling their share.