A mutual fund is an investment vehicle that pools money from many investors to purchase a diversified portfolio of securities like stocks, bonds and other assets.

It’s like a collective investment club where everyone contributes money and a professional manager handles the buying, selling and managing of the investments.

Pooling resources allows individual investors to access a variety of assets they might not be able to afford on their own, all with a single transaction, while the diversified range of assets spreads risk.

In this guide, you’ll learn what a mutual fund is, how it works and the benefits and drawbacks for investors. Table of Contents

How a Mutual Fund Works

Common Types and Categories

Mutual Funds vs. ETFs

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How a Mutual Fund Works

A mutual fund ga

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