What’s a mutual fund?

Mutual funds are a type of investment that pools money together from many different investors. This money is then used to buy a collection of diversified, professionally managed portfolios that include different types of securities, like equities or bonds. These portfolios would normally be inaccessible to individual investors, as their commissions and fees would be cost-prohibitive for an individual person.

Typically, mutual funds are managed by investment companies, like The Vanguard Group. They can also be managed by financial professionals, hedge funds, banks, and other financial institutions.

 

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