Mutual fund is a financial service where the asset management company

collects money from many people and invest in different options available.
They collect money from people who have similar objective from investing,
who are ready to take the same amount of risk and require similar return and
invests in different securities
The money is invested in bonds equities, bonds, money market instruments and
other securities.
And when returns are generated, these returns are proportionately divided
among the investors on the basis of their investment

Open ended and close ended

Open ended mutual funds always open for investment and redemption. You can
invest and redeem your money whenever you want. They don’t have any lock in
periods.
Close ended mutual fund is where your investment is locked in for a certain
period. You can invest in close ended mutual fund when it is nearly offered in
the market and sell after the locking period.

There are two ways in which you can put your money in mutual funds one is
lump sum and one is systematic investment plan
In lump sum method we invest a certain amount all together one time for a
certain period of time and then invest later with more amount if we want.
In sip method you fix an amount you will be investing at a regular interval for a
certain period of time. And then every time this money will be invested till your
redeem period. This can be weekly, monthly, quarterly etc. It helps you to
maintain a regular investment habit. And the investment amount required is also
less here.
Investment trust is a financial organization that pools the funds of its
shareholders and invests them in a different security.
It is different from mutual funds – mutual funds provide a unit for the money
invested – here shares are offered to the investor
Investment trust have a certain amount of shares – these shares are bought and
sold.
So, when a person wants to invests in investment trust, they are given shares of
the trust company and their money are invested in different assets.
They also invest in projects and real estates; theses are real estate investment
trust.
Functions
1. In investment trust money is taken from the investors and invested in
different portfolios. They don’t put all our money in one place they invest
in different message like that the risk will also be less. This is done by
 professionals who have good knowledge about the current investment
opportunities.
So, like that we can get more returns.
2. As the investments are done by professionals, they do thorough research
about all the available investment opportunities and they asses the risk
involved and how much return we can get. This way our invested funds
will be safer.
3. Even after investing they don’t just leave it at that, they’re always
monitoring the invested funds to see how they are performing and they
decide if they should keep on investing or they should take it back.
Advantages
1. Here, all the money are not invested in a single place, they are diversified.
The manager looks at all the opportunities available and invests in assets
good returns. So even if one of the assets doesn’t perform very well then,
the others can compensate for the loss. This way the losses are also
reduced.
2. These funds are managed by professionals. They have good knowledge
about all the investment opportunities available in the market and they
know the current trend in the market. They regularly keep watch of the
market. So, they know more about where to invest the money.
Disadvantages
1. The returns may not be quick it may take more time to get good returns.
2. And once we invest India share source investment first we don’t have
control over where the money is further invested it is done by the
managers so it’s upon their decision where the money is invested.