What exactly mutual fund implies and Is it profitable to invest in mutual funds ?

how do u expect u growth rate of ur invested money in mutual fund..??

Mutual Funds allow the accumulation of the money of several investors with the purpose of achieving a common financial objective.

When you invest in a mutual fund, you become its shareholder through the purchase of shares or portions of the fund. Every mutual fund has its own fund manager, who operates with its resources by investing them in securities such as stocks or bonds.

It is possible to invest in a mutual fund even if you lack substantial financial resources. Mutual funds allow for the investment of small amounts. For example, some companies offer the opportunity of participating in an index fund by investing as little as 50$ a month (What is more, TIAA-CREF has set the monthly amount at $25).

Mutual funds have many adantages one of which is that compared to stock investors who get special treatment from banks and brokerage firms when operating with large sums of money, mutual fund investors are all treated equally.

Mutual funds enjoy high popularity mainly because:
- The achievement of capital growth and income preservation is greatly facilitated in a less expensive and easy way.
- By investing in a mutual fund investors significantly decrease the risk of losing their money (similar to the investing in certificates of deposit or other investments of a fixed income type) while getting higher interest rates in the same time.
- Diversification and professional management services are automatically provided.

If you invest in a mutual fund, the choice of investments is made by the Fund Managers rather than yourself, so you'll end up with a little bit in a lot of different stocks and maybe bonds.
How well you do depends on the market in general and the skill of the Fund Managers in particular.

Mutual funds are a pool of money that investment firms invest on behalf of their clients. There are many types involving various levals of risk. They are a good investment for the small investor. You get instant divesification accross a broad range of stocks.

I would go to the library and pick up a couple books on mutual fund investing and that should help you get the basics down.

Hope that helps,

Dale