Mutual funds are a popular choice among investors due to common features such as:
- Professional management. When you select a mutual fund, you’re also selecting a professional to manage your money. Rather than researching each investment before you buy or sell, you can leave it to the professionals to handle it for you.
- Diversification. Usually mutual funds invest in a wide range of different companies and industries. This helps reduce your risk if a particular company or industry declines since your assets are diversified.
- Low minimum investment. Most mutual funds are affordable and have a relatively low dollar amount for the initial purchase of shares and future purchases. They also allow you to invest without making individual purchases and trades.