What is Mutual Fund?

A mutual fund is an investment vehicle that that pools the savings of large number of people. In other words, it’s a collective Fund which is run by a Mutual Fund Manager.
Investors in a Mutual Funds share common financial objective and their pooled money is used in investing in various financial assets such as Stocks, Bonds, Money Market Instruments and commodities, such as Gold etc according to Fund Objectives. The funds are well diversified to minimize and /or offset losses.

Source: moneycontrol.com

Each investor owns units, which represent a portion of the holdings of the fund. Mutual Funds provide simplest and yet very effective investment option to common investors who can’t devote much time in learning financial markets.

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