A mutual fund is an investment vehicle that pools money from many investors to purchase a diversified portfolio of stocks, bonds, or other securities. This allows individual investors access to a broad range of investments with the convenience of professional management.

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A Mutual Fund

Question 151

Multiple Choice

A mutual fund

A) is a financial market where small firms mutually agree to sell stocks and bonds to raise funds.
B) is funds set aside by local governments to lend to small firms who want to invest in projects that are mutually beneficial to the firm and community.
C) sells stocks and bonds on behalf of small and less known firms who would otherwise have to pay high interest to obtain credit.
D) is an institution that sells shares to the public and uses the proceeds to buy a selection of various types of both stocks and bonds.

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