Definition: Mutual Fund

A Mutual Fund is a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. These funds may hold over 10,000 stocks and are widely diversified.

Mutual funds are constantly offering new shares for sale to the public. As the Table below indicates, there is an astronomical number of different funds from which to choose.

Investment Options
Total number of stocks 14,089
Total number of mutual funds 30,586
Total number of new funds 54,364
Total number of fund closures 23,778

Data is from the Survivor Bias Free Mutual Fund Database created by the Center for Research in Security Prices (CRSP) as of 12/31/13.