Investing in a mutual fund is a way to pool money from many investors to purchase various securities
That money is then invested in accordance with the objectives predefined by the fund manager. When someone invests in a mutual fund, that person buys units of the fund, and according to the money invested, own a proportional amount of the fund.
Investing in a mutual fund is an easy and affordable way to have access to a large variety of investments which would be impossible to get on an individual basis. Since each fund may hold between 50 to 100 positions, the client is able to participate in a diversification that would not be attainable without a large outlay of capital.
There is a wide variety of asset classes available with mutual funds to meet the goals of all types of investors, from the most conservative to the most aggressive. Mutual funds are so versatile that they can be used to set up an emergency fund or nest-egg, savings for vacations or for the initial payment of a house and are also great candidates for RESP or RDSP planning.