A
mutual fund is a professionally managed trust that pools the savings of many
investors and invest in stocks, bonds, short-term money market instruments and
commodities such as precious metals. Investors have a common financial goal to
invest in mutual fund and their money is invested in different assets according
to the mutual fund objective. Mutual fund provides advantage of professional
management to the retail investors.
A
mutual fund company collects money from investors and invests it in various securities
like Stocks, Bonds and other market instruments. Mutual fund is managed by
professionals who understand the market very well and try to accomplish growth
by making strategic investments. Investors get units of the mutual fund
according to the amount they have invested. The Asset Management Company is
responsible for managing the investments for the various schemes operated by
the mutual fund.
