Mutual funds offer several benefits over individual investing including diversification, professional management, and low cost access to financial markets. However mutual funds also come with some drawbacks for instance they are not liquid meaning there is a delay before you can withdraw your money from it or switch into another type of investment if desired.
Mutual funds provide professional management and allow for diversified holdings across different asset classes such as stocks, bonds and commodities.
Mutual funds provide opportunities for many investors to pool their money together to allow them to diversify across multiple types of securities such as asset classes like stocks and bonds without the need of maintaining a large number of accounts with different brokers. This reduces transaction costs by allowing one person or team manage all these assets, they can also help minimize taxes since all capital gains are aggregated together. Mutual funds have fees associated with them but these fees are typically lower than those associated with trading securities on ones own due to the large number of investors in one mutual fund compared to an individual investor.