Final answer:
A mutual fund is a type of investment vehicle that pools money from many investors to buy a diversified portfolio of securities. Investors buy shares of the mutual fund and receive returns based on the fund's performance.
Step-by-step explanation:
A mutual fund is the pooling of money from many investors to buy a large selection of securities.
It is a type of investment vehicle that allows individuals to invest in a diversified portfolio of stocks, bonds, and other assets. When an investor buys shares of a mutual fund, they are essentially buying a portion of the fund's portfolio.
The return on investment for the investor is based on how the fund as a whole performs.