A mutual fund is defined as a type of investment vehicle consisting of a portfolio of stocks, bonds or other securities, which is overseen by a professional money manager.
| MORE ON MUTUAL FUNDS | A mutual fund is an investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. Mutual funds are operated by money managers, who invest the fund's capital and attempt to produce capital gains and income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment objectives stated in its prospectus. | Mutual funds are considered by many to be a "set it and forget it" investment (the official term would be a buy-and-hold investment). That's because a mutual fund involves the safety-in-numbers factor. They include not one security, but many, so they tend to be less volatile than many individual stocks. If you have a 401(k) retirement account, there is a good chance that some of that money is being invested in mutual funds, read on. | | | | | CONNECT WITH INVESTOPEDIA | | | | | |