Definition: A mutual fund is simply a financial intermediary that allows a group of investors to pool their money together with a predetermined investment objective. The mutual fund will have a fund manager who is responsible for investing the pooled money into specific securities (usually stocks or bonds). When you invest in a mutual fund, you are buying shares (or portions) of the mutual fund and become a shareholder of the fund.
Mutual funds are one of the best investments ever created because they are very cost efficient and very easy to invest in (you don't have to figure out which stocks or bonds to buy). For more information on what a mutual fund is, I suggest reading "What is a Mutual Fund."
Also Known As: funds
Alternate Spellings: mutual funds
Common Misspellings: mutuel fund, mutualfund
