The key difference between mutual funds and separately managed accounts is that:

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The key difference between mutual funds and separately managed accounts is that mutual funds pool all investor funds in one account while separate accounts investors own stocks and bonds that are placed in their name in a segregated account. This means that a mutual fund is a type of investment vehicle where several investors pool their money together to invest in a range of securities, whereas separately managed accounts (SMAs) are investment accounts where an individual investor contracts with a financial institution to manage their assets. Therefore, D is the correct choice. A, B, C, and E are incorrect as they do not accurately describe the key difference between the two investment options.

The Key Difference Between Mutual Funds and Separately Managed Accounts