WHAT ARE MUTUAL FUNDS
MUTUAL FUND CAN SEEM TRICKY
BUT THEY ARE VERY SIMPLE
SUPPOSE A GIRL GOT RS 10 FROM HIS FATHER.
BUT SHE WANTED TO BUY A RS 100CHOCOLATE BOX.
SO SHE CONVINCED HER OTHER FRIENDS TO COLLECTIVELY BUY THE CHOCOLATE BOX.
THE KIDS COLLECTIVELY CONTRIBUTED RS 100 (SOME MORE , SOME LESS TO BUY THE CHOCOLATE BOX.
THE KIDS THEN DISTRIBUTED CHOCOLATES PROPORTIONATELYAMONGST THEM ACCORDINGLY TO THE CONTRIBUTION.
MUTUAL = FROM MANY PEOPLE
FUND = POOL OF MONEY
THE MONEY POOLED IN BY A LARGE NUMBER OF PEOPLE (OR INVESTORS) IS WHAT MAKES UP A MUTUAL FUND.
THIS FUND IS MANAGED BY A PROFESSIONAL FUND MANAGER.
THEN, IT INVESTS THE MONEY IN STOCKS, BONDS, AND OTHER MARKET INSTRUMENTS.
THE INCOME/GAINS GENERATED FROM THIS COLLECTIVE INSTRUMENT IS DISTRIBUTED PROPORTIONATELY AMONGST THE INVESTORS.
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