Which investment vehicle pools money and invests in a professionally managed portfolio that may include stocks and bonds?

• A. Bond
• B. Stock
• C. Mutual Fund
• D. ETF

Answer: (C)

Pooled investing with professional management. A mutual fund gathers money from many investors and hires a fund manager to build and oversee a diversified portfolio of securities, which can include stocks and bonds. This professional oversight aims to meet the fund’s investment objective and provides diversification so you’re not backing a single stock or bond. You own shares in the fund, and your returns come from the fund’s overall performance, after fees.

This fits best because it describes a single vehicle designed to pool resources and be actively managed by professionals, with the ability to hold a mix of asset types. A single bond or a single stock lacks diversification and professional portfolio management. An ETF also pools money, but it’s typically traded on an exchange and often tracks an index with passive management, rather than being actively managed like a traditional mutual fund.