A Mutual Fund is savings altogether from many investors are collectively invested as one by professionally-managed trust.. The money can then be invested in stocks, bonds, short term money market instruments, and commodities like precious metals.
Mutual fund investors share a common financials objectives. This, along with the fund's investment goal, means that their money is allocated to different asset classes. The funds are well-diversified and can offset any potential losses.
Mutual funds require a smaller amount of money than other instruments. Retail investors have the benefit of having experienced finance professionals manage and invest their money, even if they only have a few thousand rupees. Professional fund managers manage mutual funds, or they are passively tracked by an industry index.
These are great options for investors who don't have the time or knowledge required to make complex and traditional investment decisions. They can also manage their savings passively and not pay high fees. However, this also means that you can let the portfolio manager make these important decisions for you by placing your money in mutual funds.