A Mutual Fund is a pooled investment vehicle where many investors combine their money to buy a diversified collection of stocks, bonds, or other securities managed by professional fund managers. Think of it as splitting the cost of a expensive basket of investments with hundreds or thousands of other people. Instead of buying individual stocks, you buy shares of the mutual fund, which owns pieces of many different companies. This provides instant diversification and professional management for smaller investors who couldn’t afford to buy all those individual securities on their own. Your returns depend on how well the fund’s holdings perform overall.