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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.
Related Terms
Certified Check
A check that has been certified by the bank as having sufficient funds to cover the full amount, with the bank guaranteeing payment.
Personal Loan
A flexible form of credit issued by a bank for personal use, with a fixed interest rate and repayment period.
Trust
A legal arrangement in which one party transfers ownership of property to another person or entity to be managed for the benefit of a third party.