Once you've made the decision to invest in the stock market, mutual funds are an easy way to own the stocks without the worry of choosing individual stocks.
As an added bonus, you can find a lot of information on the Internet to help you learn about, study, select, and purchase these stocks. But what is a mutual fund? It's not as complicated as it sounds. A definition of a mutual fund is a single portfolio of stocks, bonds, and/or cash managed by an investment company on behalf of many investors. The fund is managed by the investment company who sells the shares with the outcomes of funding individual investors. Investing in a mutual fund, allows you to become a part owner of a large investment portfolio, along with the other shareholders of the fund.
When you purchase the shares, the fund manager invests your particular funds, along with the money contributed by the other shareholders.