Mutual Funds Explained: How They Work, Fees, and the Pros and Cons

A mutual fund is a pooled investment vehicle where many investors combine their money so a professional manager can buy a diversified mix of stocks or bonds on their behalf. First created in 1924, mutual funds are one of the oldest and most common investment tools. In this episode, Ryan explains how active management works, what the expense ratio actually costs you, and why mutual funds trade at end-of-day prices rather than in real time.The pros include easy diversification and professional management. The cons include higher costs than ETFs, shared capital-gains tax events you can't control, and no intraday trading. Ryan and Aaron also share a few childhood financial heroes, including Warren Buffett and Ken Griffey Jr.Find "Your Fiscal Physical" the book on AmazonIf you have suggestions or feedback, please email us at: [email protected], as always, Stay the Course!