by Lauren
A mutual fund is a professionally managed investment fund
that pools money from many investors to purchase securities. Some investors may
be retail or institutional. Advantages of mutual funds are that they provide
economies of scale, a higher level of diversification, they provide liquidity,
and they are managed by investors who are professional. Disadvantages is that
the investors in a mutual fund must pay various fees and expenses. When you buy
a mutual fund, your money is then combined with the money from other investors,
which allows you to buy part of a pool of investments. For some people mutual
funds may not be for them as there are multiple fees you have to pay, like
sales charges, fees and expenses regardless of how the fund performs, even if
the fund has a negative outcome. Also with mutual funds the fund’s holdings are
only known to investors at certain points in time, which means you don’t have
any influence or control over specific investment decisions made by the
portfolio manager which some people may not like. Therefore if you’re
interested in investing then I would recommend doing a mutual fund.
http://www.globefund.com/centre/GettingStarted02.html
https://www.google.ca/search?q=advantages+and+disadvantages+of+mutual+funds&rlz=1C1GGRV_enCA751CA751&oq=advantages+and+disadvantages+of+mutual+funds&aqs=chrome..69i57.11246j0j4&sourceid=chrome&ie=UTF-8
