Mutual Fund

Definition

  • A professionally-managed collective investment scheme made up of the pooled funds of multiple investors. Mutual funds give investors with limited access to capital the option to invest in a professionally managed and diversified portfolio of securities. The funds collected by the managers of the mutual fund are invested in securities such as stocks, bonds, money market instruments, and other types of securities.

Synonyms
stocks and bonds, mutual investments, co-operative funds

Related Terms and Acronyms

  • Closed-end Fund Definition,
    • A mutual fund with shares initially sold to investors through an IPO; afterwards, the fund is listed on a stock exchange to be bought and sold.
  • Fixed-Return Investments Definition,
    • Investments that provide a stable return.
  • Indexed Annuity Definition,
    • An annuity where investment performance is pegged to a stock index.
  • Internal Rate of Return (IRR) Acronym, Important,
    • That rate at which the present worth of all present and future investment costs equals the present worth of all present and future investment benefits.
  • Investment Definition,
    • Something you put your money into in order to make money.
  • Issuer Definition,
    • A legal entity that develops, registers, and sells securities including stocks, bonds and derivatives.
  • Money Market Account (MMA) Acronym,
    • A bank account that restricts the type and number of withdrawals. The account also earns interest similar to money market funds.
  • Money Market Mutual Fund (MMMF) Acronym,
    • A mutual fund that invests in short-term debt instruments such as Treasury bills, commercial paper, and large CDs. Also referred to as money market fund (MMF).
  • Open-end Fund Definition,
    • A mutual fund that allows investors to buy or sell shares in the fund at their net asset value each business day.
  • Parking (prk) Abbreviation,
    • A term that refers to depositing cash in a high-yield money market account until it is transferred to another account to pay bills.
  • Portfolio Definition,
    • A collection of investments.
  • Protected Cell Company (SPC) Acronym,
    • A company that separates its assets and liabilities into a number of 'cells' to shield itself and each 'cell' from losses.
  • Protected Fund Definition,
    • A mutual fund that guarantees investors a return on their investments.
  • Return Definition,
    • Any increase in value or in income you earn on purchase or investment.
  • Securities/Investment Dealer Definition,
    • One who acts as the agent for another party to buy and sell securities and other investments; also an underwriter.
  • Security Definition,
    • A tradable financial implement that represents ownership, the rights to ownership or debt.
    • Property designated as collateral.
    • A document stating ownership of a stock or bond.
  • Segregated Fund Definition,
    • Investment vehicles that feature both maturity and death guarantees. Segregated funds share similarities with mutual funds but are categorized as insurance products.
  • Stock Definition,
    • A share of the ownership of a company.
  • Stock Insurance Company Definition,
    • An insurance company with multiple stockholders each owning shares in the corporation.
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