1. Diversification — Mutual funds generally give instant and broad diversification that is otherwise difficult for average investors to achieve on their own.
2. Professional management — Mutual funds also provide professional management. Trained professionals conduct daily tracking of the markets and economy, and in-depth analysis of portfolio holdings.
3. Liquidity — With a mutual fund you can redeem all or a portion of your shares on any business day. (Remember, though, that the value of the shares will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.)
4. Convenient services — Mutual funds offer many options such as direct deposit, automatic investing, and withdrawals.
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