A mutual fund is a professionally managed investment fund that pools money from multiple investors and allocates the pool into a diverse range of assets such as short-term debts, stocks, and bonds. These assets may include investments in small-cap, mid-cap, and large-cap companies, providing investors with exposure to various segments of the market. The aim is to generate returns while managing risks effectively. Investors often seek out the best mutual funds that align with their financial goals and risk tolerance, relying on the expertise of fund managers to make informed investment decisions.