Mutual funds are operated by investment companies that raise money from shareholders and invest in a group of assets, such as stocks, bonds and money market instruments. Investors in the fund receive an equity position in the fund.
Mutual funds offer liquidity and convenience, but charge fees and often require a minimum investment. There are many types of mutual funds, including aggressive growth fund, asset allocation fund, balanced fund, blend fund, bond fund, capital appreciation fund, clone fund, closed fund, crossover fund, equity fund, fund of funds, global fund, growth fund, growth and income fund, hedge fund, income fund, index fund, international fund, money market fund, municipal bond fund, prime rate fund, regional fund, sector fund, specialty fund, stock fund, and tax-free bond fund.
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