Mutual Fund

A type of fund managed by professional investment managers that pools money from many investors and uses that money to buy a diversified portfolio.

More Details

A mutual fund is an investment vehicle that pools together money from a large number of investors and uses that money to buy a diversified portfolio of stocks, bonds, or other securities. Mutual funds are managed by professional fund managers who research and select investments for the fund based on its stated investment objective.

Example

Imagine that you want to invest in the stock market but don't have the time or expertise to choose individual stocks. You might invest in a mutual fund instead. Your money is combined with other investors' money and the fund manager uses it to buy a diversified portfolio of stocks, bonds, or other securities. You can choose a mutual fund based on your investment goals and buy or sell shares as needed. Mutual funds can be a convenient and diversified way to invest in the stock market and can be suitable for investors with different risk tolerances and investment horizons.

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