Definition

Mutual Fund

Mutual Fund is a financial vehicle which involves pooling investments in the shares of many different joint stock (or publicly traded) companies, in order to reduce the risk and overhead costs associated with investing in corporate shares. An investor buys a unit in the mutual fund, and receives a pro-rated portion of the fund’s total income (including both dividends and capital gains).


Mutual fund is a fund formed by a group of individual investors, who pool their money to invest in securities, and usually handled by a professional investment manger.

Category: Economics
References
Share it:  Cite

More from this Section

  • Credit rationing
    Credit rationing is a lender’s refusal to make loans even though borrowers are willing ...
  • Auditors’ report
    Auditors’ report is a report written by a company’s auditors after they have examined ...
  • Overnight cash rate
    Overnight cash rate is the interest rate for very-short-term interbank loans in the euro ...
  • Multinational corporation (MNC)
    A multinational corporation (MNC) is a company which directly undertakes productive facilities ...
  • Counter-Cyclical Policies
    Counter-Cyclical Policies are governments can take many different actions to offset the ...