ECONOMICS
RISK AND RETURN
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Investment company that pools the money of many investors to buy securities
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Investment company uses the money of a investor to buy securities then pays them back later with interest
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Banking company that pools the money of many investors to buy securities
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None of the above
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Detailed explanation-1: -A mutual fund is a pool of money managed by a professional Fund Manager. It is a trust that collects money from a number of investors who share a common investment objective and invests the same in equities, bonds, money market instruments and/or other securities.
Detailed explanation-2: -Mutual funds let you pool your money with other investors to “mutually” buy stocks, bonds, and other investments. They’re run by professional money managers who decide which securities to buy (stocks, bonds, etc.) and when to sell them.
Detailed explanation-3: -A mutual fund is a company that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt. The combined holdings of the mutual fund are known as its portfolio. Investors buy shares in mutual funds.
Detailed explanation-4: -A mutual fund is an investment company that pools money from many investors and invests the combined holdings in a single portfolio of securities that may include stocks, bonds, other securities and cash and cash alternatives, such as Treasury Bills, certificates of deposit (CDs) and money market funds.
Detailed explanation-5: -A Mutual Fund is an investment company that pools the funds of many individual and institutional investors to form a massive asset base. The assets are then entrusted to a full time professional fund manager who develops and maintains a diversified portfolio of security investments.