or unit trust or open-end trust
Company that invests the funds of its subscribers in diversified securities and issues units representing shares in those holdings.
It differs from an investment trust , which issues shares in the company itself. While investment trusts have a fixed capitalization and a limited number of shares for sale, mutual funds make a continuous offering of new shares at net asset value (plus a sales charge) and redeem their shares on demand at net asset value, determined daily by the market value of the securities they hold.