mutual-fund

Vocabulary Word

Definition

A 'Mutual Fund' is like a big basket full of different types of investments, like stocks and bonds. Many people pool their money together to buy this basket, so they can own a little piece of many different investments.

Examples in Different Contexts

In personal finance, investing in a 'mutual fund' is a way for individuals to gain exposure to a broad range of investments with a single purchase. A financial planner might note, 'Mutual funds can be an excellent option for new investors seeking to build their portfolios.'

Practice Scenarios

Leadership

Scenario:

We need to form a strategy for financial risk management. What options do we have to increase our financial stability?

Response:

Investing in mutual funds could be a good strategy. They offer diversification and are managed by professionals.

Business

Scenario:

I've been looking into various investment opportunities for the firm's surplus cash. Have you looked into any diversified investment portfolios?

Response:

That's a sound consideration. Adding a well-performing mutual fund to our investments could potentially diversify our profit sources.