The ABC's of Investing Mutual funds invest in many different types of securities. Securities can include stocks, bonds, or cash. The main goal of cash investments is to make money for investors, while trying to keep your original account value the same.
Cash includes many different savings and other types of investment accounts.
For most people, cash usually includes savings accounts, bank Certificates of Deposits, and money market funds. These types of accounts are usually conservative, meaning they have less risk. So, you may want to invest in these accounts if you are saving for something you can buy in the next two years, or less. Bonds represent debt, or money that is owed. The government and corporations can offer bonds to the public to raise money to pay for things they want to buy.