A mutual fund is generally a diversified portfolio of securities which may include stocks, bonds or money market instruments or some combination of these investments. The portfolio is managed by an investment management organization that makes decisions based on extensive research on when to purchase, sell and hold securities. A mutual fund combines the money invested by its shareholders and invests it in a variety of securities. The type of securities included in a mutual fund portfolio will depend on the fund's objective - that is, the fund's goal, such as preservation of principal, income generation, growth, or some combination of the three.
Shares represent interests in the mutual fund.
The securities selected must remain consistent with the fund's investment objective. The value of fund shares will fluctuate, so when you sell fund shares they may be worth more or less than when you initially purchased them. Regardless of the size of you investment, every dollar in a mutual fund is entitled to equal treatment, whether it belongs to a small investor or a big corporation. Please read it carefully before investing.