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Mutual fund facts for kids

Kids Encyclopedia Facts

A mutual fund is a kind of investment that uses money from investors to invest in stocks, bonds or other types of investment. A fund manager (or "portfolio manager") decides how to invest the money, and for this he is paid a fee, which comes from the money in the fund.

Mutual funds are usually "open ended", meaning that new investors can join into the fund at any time. When this happens, new units, which are like shares, are given to the new investors.

There are thousands of different kinds of mutual funds, specializing in investing in different countries, different types of businesses, and different investment styles. There are even some funds that only invest in other funds.

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Mutual fund Facts for Kids. Kiddle Encyclopedia.