What is a Mutual Fund | by Wall Street Survivor

What is a mutual fund?
Learn more at: https://www.wallstreetsurvivor.com

A mutual fund is a professionally managed investment vehicle that pools money from many investors to purchase securities (stocks, bonds, money market instruments etc.). A money manager then decides how the funds are invested so you don’t have to – but you pay for it. A mutual fund’s management and operational fees, known as the management expense ration (MER), are deducted from the return on your investment.

While it is tempting to think that a mutual fund is a hedge fund…it’s also incorrect. Mutual funds aren’t hedge funds because mutual funds can be sold to the general public - unlike hedge funds.

There are many kinds of mutual funds:
 Specialty funds that focus on particular market sector (energy, health, etc.)
 Index funds (which track a market index like the S&P 500)
 Real estate funds

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