The price of a mutual fund is based on its net asset value (or NAV).

Mutual funds come with a few associated fees.

Mutual fund investors typically must pay a variety of different types of taxes associated with their investment, unless the funds are within tax-advantaged accounts like a 401(k) or IRA.

Read about the pros and cons of mutual funds.

Open-end and closed-end mutual funds differ in how they create and distribute shares.

Explore a list of the world's largest mutual funds.

How mutual funds work

Mutual funds function similarly to other types of investments. If you want to invest, you go through a brokerage firm. However, they have a few key differentiators. Most are actively managed by a broker instead of passively earning you returns. Plus, they can carry some hefty fees.

Mutual funds pool money to create larger investment opportunities with higher returns for anyone who initially invests in the fund.

Investing in mutual funds can give you access to a wide range of securities, such as stocks and bonds, with just a single investment.

Figure out what type of mutual fund is right for you with a tool that lets you compare different mutual funds, from rates to returns.

Mutual fund share classes are rankings of different types of services for investors.

Mutual funds are categorized as stock, bond, money market, and target-date funds.

ETFs and mutual funds both pool money into a basket of investments—but the key difference between them is that mutual funds trade just once per day after the market closes, while ETFs trade like stocks throughout the day at fluctuating prices.

Mutual funds invest in multiple different companies with money from many investors, while an individual stock invests in one company with funds from a single investor.

Learn how to calculate your net worth

Someone's net worth is the value of their assets minus their liabilities. Assets may include a home or a retirement savings account, whereas examples of liabilities include student or credit card debt.

The median trust fund contains roughly $285K

That’s according to data from the US Federal Reserve. There isn’t a specific net worth that can help determine whether or not someone needs a trust—but contrary to popular belief, trust funds can be great estate planning tools, even for people who aren’t ultra-wealthy.

Contrary to popular belief, random investments can outperform managed funds.

Mutual funds were first created and sold in the US in 1924.

ETFs and mutual funds are both taxed on capital gains and on dividends.

A cost basis is an asset's purchase price after accounting for certain other factors

If you bought a share for $5 and sold it for $140, your capital gain would be $135...on paper, at least. In reality, the math is fuzzier. Capital gains are actually the difference between the sale price of the asset and your cost basis.

The bond market is where bonds and other debt securities are traded

Bonds are fixed-income investments allowing individuals to lend a specific amount of money to a large entity, like a government or corporation, for a set amount of time in return for interest paid out over the life of the loan. The bond market is widely considered a key economic barometer.

The national debt is the total amount the US government owes its creditors

This US Treasury page explains what the national debt is, how it accumulates from annual deficits, and why rising debt can affect interest costs, fiscal flexibility, and long-term economic stability.

A margin call is a way for traders to pay off debts by selling a security before they may be ready to do so.

Explore a database that shows how the US national debt changes over a 24-hour period.

For everyday Americans, a relatively high national debt can lead to higher interest rates on financial products such as mortgages.

Total national debt as of yesterday

Debt to the Penny is the total debt of the U.S. government and is reported daily. It is made up of intragovernmental holdings and debt held by the public.

The national debt consists of public debt and intragovernmental debt.

Hedge funds make money from imposing steep fees on investors, as well as from investment performance

Hedge funds often operate on a "2 and 20" model: Investors pay fund managers a 2% management fee, and the hedge fund keeps 20% of their profits. (The 2% is imposed annually, irrespective of performance.) Hedge funds are known for chasing big returns—and taking big risks to get them. This explainer not only breaks down how they work in detail, but also the strategy first introduced in 1949 that still shapes hedge fund investing today.

Asset location is the type of account an asset is placed in

Investors are likely familiar with “asset allocation,” creating an ideal mix of different asset types in an individual's portfolio. But asset location matters just as much for investors who are conscious of how much they owe in capital gains taxes.

The 'Big Three' asset managers—Vanguard, State Street, and BlackRock—collectively manage more than $30T in assets and are the largest shareholders in roughly 88% of all the companies listed on the S&P 500.

Test your ETF knowledge

A 10-question quiz from the SEC allows investors to test their basic knowledge about exchange-traded funds and their investing counterparts, mutual funds. Here’s a sample question: Is the past performance of a fund a good indicator of future results? (Hint, the answer is no).

The federal deficit is the gap between what the US spends and what it collects.

One $100 investment in the Medallion Fund skyrockets over time

The Medallion Fund, the famously secretive quant fund that invests billions of dollars for the partners and employees of a single firm with a legendary track record, has trounced the market for more than three decades. While its results are an extreme outlier, this visualization showcases the power of compound interest.

The total cost of owning an ETF is the sum of the holding costs and the transaction costs

Holding costs include things like the expense ratio, or the annual fee that a fund issuer charges. Transaction costs include things like brokerage commissions, or the fee that a broker charges to enact a trade. However, in recent years, most brokers have essentially eliminated commissions on ETF trading.

An expense ratio represents the cost to own an ETF over the course of the year

For instance, an expense ratio of 0.5% would add a cost of $50 on an investment of $10K. And while expense ratios have on average decreased in recent years, a particularly hefty fee can still eat into total profits.

If the US government paid off its debt, it could disrupt the entire bond market, as Treasury bonds are among the most common bonds for investors and the majority of the national debt is in bonds.

Some private credit funds trade on the stock market

These funds, which trade at market prices, are called "public BDCs," which stands for "business development companies." For instance, the global alternative investment manager Ares Management Corp. has a public BDC.

See a chart showing how much the US federal government pays in interest on its debt.