Mutual Funds/Stocks and mutual funds

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Question
What is the difference between stocks and mutual funds?
I have read an economist said that stocks will soon collapse by 50%. Do you have an opinion about that?
If stocks do really collapse soon by 50%, will mutual funds have a similar fate?
Sincerely,
Andres Ruvalcaba.

Answer
Hi. Stock mutual funds are simply a diversified portfolio of many different stocks that allows investors to get broad exposure to many different investments. Mutual fund performance therefore will be dictated by the performance of the underlying stocks that are within the fund. In regards to your question about a market "collapse", this is difficult if not impossible to accurately predict over time. The stock market goes up and down and there are many factors that influence this. In any instance, not all mutual funds will have similar fate during market increase and decreases as mutual fund performance is driven by the underlying performance of the holdings within and there are many different types of mutual funds. I hope this helps.

Mutual Funds

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