Definition

1. Noun:
   • A type of investment company that pools money from many shareholders and invests it in a portfolio of assets such as stocks, bonds, or other securities. Each shareholder owns a portion of the fund, represented by shares, and participates proportionally in the gains or losses of the fund's total portfolio.

Usage

• As a subject: A mutual fund provides diversification for individual investors.
• As an object: She decided to invest in a mutual fund focused on technology stocks.
• With modifiers: The low-cost mutual fund has performed well over the last decade. He reviewed the mutual fund's prospectus before buying shares.

Examples

• For retirement savings, many people choose a mutual fund that tracks a broad market index.
• The value of your investment in a mutual fund will fluctuate with the market.
• Management fees are an important factor to consider when selecting a mutual fund.

Advanced Usage

• "to be invested in a mutual fund": to have one's money placed within such a fund.
  • A significant portion of his portfolio is invested in a conservative mutual fund.
• "to redeem shares of a mutual fund": to sell one's shares back to the fund company.
  • You can usually redeem shares of a mutual fund at the end of the trading day.

Variants and Related Words

• Fund family (n): A group of mutual funds managed by the same investment company.
  • The investment company offers dozens of funds within its fund family.
• Net Asset Value (NAV) (n): The per-share value of a mutual fund, calculated daily based on the total value of the fund's assets minus its liabilities.
  • The mutual fund's NAV is published at the close of each trading day.
• Exchange-Traded Fund (ETF) (n): A similar pooled investment that trades on a stock exchange like a single stock, often with lower fees. (This is a distinct, related product).

Synonyms

• Investment fund: A general term for any pooled investment vehicle.
• Managed fund: Emphasizes the active management of the portfolio (though some mutual funds are passively managed).

Related Phrases

• Load fund: A mutual fund that charges a sales commission or fee.
  • A financial advisor might recommend a load fund, for which they receive a commission.
• No-load fund: A mutual fund that does not charge a sales commission.
  • Many investors prefer no-load funds to avoid upfront sales charges.

Noun

1. a regulated investment company with a pool of assets that regularly sells and redeems its shares
2. the pooled money that is invested in assets