A mutual fund is an investment vehicle, in which money from multiple people is pooled together and invested in a variety of bonds, stocks, and other securities. Mutual funds are managed by professionals that take the investment decisions with the objective of growing the overall fund value. As the total fund value increases, so does your share in the fund; as the fund value decreases, so does your share as well.

• Money market funds
  Money market mutual funds can only invest in certain short-term, high-quality investments issued by the government. They are relatively low risk.
• Bond funds
  Bond funds come with higher risk than money market funds but aim to produce higher returns. There are multiple types of bonds available; therefore, the risk and return of bond funds can vary significantly.
• Stock funds
  These funds invest in corporate stocks. Stock funds can be further subdivided into income funds, index funds, growth funds, and sector funds.
• Target date funds
  Target date funds are designed for investors with a particular retirement date in mind. They include a combination of bonds, stocks, and other securities. Over time, this combination gradually changes according to the fund’s strategy.