In a mutual fund, investors share equally in profits, losses, and management decisions.

True or False?

Answer: True

Explanation: A mutual fund is a collective pool of funds provided by a group of individuals to money managers for investment in various securities such as stocks and bonds.

Due to it's collective nature, every shareholder or investor benefits and loses in equal portion - and the expenses of the mutual fund are shared in the expense ratio.

Because the funds are invested into stocks, bonds and other securities, they usually have a lower risk than individual stocks or bonds.