The National Directory of Certified Public Accountants

Ask A CPA - Investments & Financial Planning

What Is A Mutual Fund ?

A mutual fund pools the money of many individuals into a single fund. This fund is then used to buy a wide range of stocks, bonds, or other securities aimed at meeting a specific investment goal. When purchasing a share in a mutual fund, you are gaining a proportional share ownership of all the different investments in the fund. An investment in a mutual fund is a way to diversify your investments in a quick and easy manner. Mutual funds are investment companies regulated by the Investment Company Act of 1940.

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