answersLogoWhite

0

Because:

  1. They invest in the stock markets and the stock markets are one of the best investment instruments
  2. They are operated/maintained by a trained and experienced fund manager
  3. The investor need not track the movement of the stock market everyday
  4. It gives comfort and investment diversification for the investor who is not well-versed in the stock markets but still wants to invest in mutual funds
User Avatar

Wiki User

12y ago

What else can I help you with?

Continue Learning about Finance

What would be the purpose of investing in mutual funds?

Mutual funds are a way for investors to invest safely. Mutual funds pool together stocks, bonds, and commodities, and investors get a piece of every thing, which makes it a safe way to invest in other things without a great loss.


What are the advantages of investing in mutual funds?

The advantages of investing a mutual fund is if one of the fund stocks or other securities performs poorly the loss can be offset by gains in another stock or security within the mutual fund.


Are mutual funds insured?

No they are not. Mutual funds are stock market investments and hence they are not insured. There is always a possibility of an investor suffering a loss if the mutual fund house makes wrong investment decisions.


Why did you invest in shares market?

Investing in share market saves your tax and also makes you owner of shares of the company


Why investment in mutual fund is risk less?

Investing in a mutual fund is not necessarily less of a risk. What makes a mutual fund less riskier than a single stock is that the risk is spread out amonst many more companies. Let's assume the mutual fund you own owns stock in 100 different companies. If one of those companies go bankrupt, you'll probably only lose on average 1% of your money. If you own stock in a single company and that company goes bankrupt, you lose 100% of your money. But let's assume you have stock in a very safe company like McDonald's and your friend owns a mutual fund which is comprised of 50 new fast-food restaurants. Your stock in McDonald's may actually be less of a risk than in that type of mutual fund. So, it's important to see what types of stocks a mutual fund is comprised of before assessing how safe or risky it is.

Related Questions

What would be the purpose of investing in mutual funds?

Mutual funds are a way for investors to invest safely. Mutual funds pool together stocks, bonds, and commodities, and investors get a piece of every thing, which makes it a safe way to invest in other things without a great loss.


Why invest in mutual funds?

Mutual fund is a type of collective investment that offers a portfolio consisting of various financial instruments. A single mutual fund can include stocks, bonds and other money market instruments. What makes mutual fund attractive is the diversity, which safeguards investors from immediate negative impact. For those who are not sure about their investment strategy, investing in mutual fund is a logical decision. One of the best sources for analyzing mutual funds is the official website of Morningstar. Likewise, most authentic financial sources provide useful information by rating the quality of each mutual fund. Such ratings can help investors make better investment choices.


Why Invest in a Mutual Fund ?

Mutual fund is a type of collective investment that offers a portfolio consisting of various financial instruments. A single mutual fund can include stocks, bonds and other money market instruments. What makes mutual fund attractive is the diversity, which safeguards investors from immediate negative impact. For those who are not sure about their investment strategy, investing in mutual fund is a logical decision. One of the best sources for analyzing mutual funds is the official website of Morningstar. Likewise, most authentic financial sources provide useful information by rating the quality of each mutual fund. Such ratings can help investors make better investment choices.


What makes products and services attractive to you?

The look and feel and taste makes the products more attractive to all and a fast service which comes out of cooking joints make the service attractive


What makes silk unique?

Its lustrous appearance makes it attractive


What are the advantages of investing in mutual funds?

The advantages of investing a mutual fund is if one of the fund stocks or other securities performs poorly the loss can be offset by gains in another stock or security within the mutual fund.


What is the best mutual savings bank in the world which country's mutual savings bank is well developed and what makes it best?

QT Mutual Bank


How do you get started in stock investing?

The best advice you can get when talking about stock investing is be perseverant. Also, there is no perfect way to do stock investing. However, there are a few basic steps you can follow:1-save money2-open a stock account3-fund your stock account4-select and purchase mutual funds or stocks5-save more money6-buy more stocksAnd on it goes... With time, you will get better and better at it. Like the saying goes: practice makes perfect!


What makes black holes so attractive?

there not attractive because they are practically incisible to the human eye


What makes flowers attractive to bees?

Mostly the colour.


Why do people want abs?

Because it makes them attractive.


What makes Nick Jonas attractive?

Many people say Nick Jonas is only attractive because of his voice and the fact he is in a band. But he is also attractive physically.