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mutual fund is an investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. Mutual funds are operated by money managers, who invest the fund's capital and attempt to produce capital gains and income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment.No matter what type of investor you are, there is bound to be a mutual fund that fits your taste.It's important to understand that each mutual fund has different risk and reward profiles. In general, the higher the potential return, the higher the risk of potential loss. Although some funds are less risky than others, all funds have some level of risk – it's never possible to diversify away all risk – even with so-called money market funds.
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