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A Mutual Fund is a pooling of investment funds for a number of indiviuals and institutions to purchase a diverse
amount of securities that are professionally managed. The nature or goal of the fund can be to provide
income, capital appreciation and diversification. The individual is able to take part ownership in a portfolio of
securities that he/she may not have been able to on their own. As a whole, individuals benefit from mutual funds as
they are able to better diversify their investments and usually receive better returns than they could through investing
on their own.
We have included many resources for your to learn more about: What is a Mutual Fund:
WHAT IS A MUTUAL FUND? - by Peter W. Johnson, Jr.
OVERVIEW Description. A mutual fund is a company that combines, or pools, investors' money and, generally, purchases
stocks or bonds. Ideally, a fund's size and resultant efficiency, combined with experienced management, provide
advantages for investors that include diversification, expert stock and bond selection, low costs, and convenience.
What is a Mutual Fund? - About.com
Far too often investment writers incorrectly assume that their readers understand what a mutual fund is. Read this article as an absolute starting point for learning about mutual funds. Then we can start tackling the tougher mutual fund subjects in a process that will make you a smarter investor. What Is a Mutual Fund? - From AARP A mutual fund is a company that makes investments on your behalf and on behalf of others like you. A mutual fund collects money from hundreds, or even thousands, of investors. The fund then pools this money and uses it to buy a large collection of stocks and bonds. This collection of investments is called a portfolio. As a mutual fund investor, you own a specific number of shares in your fund's portfolio. The larger your initial investment, the more shares you will own. Getting Started: Mutual Funds (PDF File) - By Merrill Lynch A mutual fund is an “investment company” that allows many investors with common investment objectives to pool their money together to invest in a portfolio of securities that they might otherwise be unable to afford. What is a mutual fund? - by BMO Mutual Funds A mutual fund is a pool of investments managed by professional money managers. When you invest in a mutual fund, you're actually pooling your money with other people who have similar investment goals. An expert called a portfolio manager invests that money on behalf of the whole group. If the investments make money, everyone shares in it. If the investments lose money, the whole group shares in the loss. Mutual Fund Basics - By Oppenheimer Funds A mutual fund provides a way for people with common financial goals to pool their resources together. The money that is brought in is invested by a professional financial manager in a number of different securities. Potentially, the investors can reap more rewards investing together than alone. Q. What exactly is a mutual fund? - By Fool.com A. Imagine this scenario: You have only $500 to invest. You believe that it's risky to invest in only one stock, but you also know that you shouldn't and can't spread yourself too thin with that amount of money. But what if you gathered 20 friends who each had $500? Together you'd have $10,000, enough to invest in several stocks without commission costs running too high. Nice job. Uh-oh, now who decides what to buy and when to sell? Ah, another problem. What Is A Mutual Fund? - By MSMoney.com Basically, a mutual fund is an investment held by a bunch of different people. Investors pool their money together and entrust it to a professional money manager who buys and sells securities based on the fund’s objective. A fund may be comprised of stocks, bonds, cash instruments, or any combination thereof. What is a Mutual Fund? - By Cheryl Marconi, Fidelity A mutual fund is actually a lot like a company - complete with a president, a board of directors, and a team of skilled professionals. In fact, a mutual fund is required to provide annual reports just like a company, conducts shareholder meetings, and is very closely regulated. What is a Mutual Fund? - By Activa Mutual Funds A mutual fund is an investment company that pools your money with that of many other investors with common financial objectives. Mutual Fund benefits include: What exactly is a mutual fund and what do they do? - By Walter Updegrave, CNN/Money Contributing Columnist Basically, a mutual fund is a type of company (the technical name is an "investment company") that pools money from thousands of investors like you and me and then hires an investment adviser (aka a fund manager) to invest that money in stocks, bonds, short-term debt securities like Treasury bills or commercial paper (i.e., corporate IOUs) or a combination of those investments. When you invest in a fund, you purchase shares that represent part ownership in the entire portfolio of securities, as well as a share of the income and gains (or losses) those securities generate.
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