A mutual fund is considered to be a type of investment where a share of funds is collected from various investors for the purpose of investing in a variety of securities such as bonds, stocks, money market accounts, and any other assets the investors may have in their portfolio. A mutual fund is handled by money managers, who will invest a fund's capital to produce capital gains and income for the fund's investors. A mutual fund can be structured to match the investment goals that are stated in the prospectus. A mutual fund can give small investors the access to professionally manage a diversified portfolio of bonds, equities and other securities which may be hard to create with just a small amount of capital.
Furthermore, a mutual fund unit can be issued and purchased when needed at a fund's current net asset value per unit. A mutual fund will fluctuate in value, but you can make money through dividends, capital gains, and the potential growth of any securities that may be within the mutual fund.There are fees that can be associated with a mutual fund such as operating costs or shareholder fees which should be declared on a mutual fund's prospectus. The Securities and Exchange Commission, also known as the SEC, does not put a limit on the fees that a mutual fund can charge, but the SEC does limit the redemption fee to 2%. You should consult the advice of United Retirement Advisors Group to help you decide what is best for your mutual fund investment needs.