What Is Mutual Fund? Meaning & Example
Definition
A mutual fund pools money from many investors to buy a portfolio of securities, managed by professionals. Shares are bought and sold at the end-of-day price.
Related terms
An ETF is a fund that holds a basket of assets and trades on an exchange like a stock. Many ETFs track an index and offer low-cost diversification.
Expense RatioThe expense ratio is the annual fee a fund charges, shown as a percentage of the money invested. Lower expense ratios leave more of the returns for investors.
Index FundAn index fund aims to match the performance of a market index by holding the same securities. It is typically low cost and widely used for passive investing.
What is Mutual Fund?
A mutual fund pools money from many investors to buy a portfolio of securities, managed by professionals. Shares are bought and sold at the end-of-day price.
Can you give an example of Mutual Fund?
A balanced mutual fund might hold 60% stocks and 40% bonds chosen by its managers.