Which of the following describes a characteristic of mutual funds?

Mutual funds are investment vehicles that allow a group of investors to pool their money together, which is then collectively managed by a professional investment manager. This pooling of resources enables investors to access a diversified portfolio of securities that they might not be able to invest in individually due to high costs or minimum investment requirements. The diversification helps to spread risk across various assets, which can potentially lead to more stable returns compared to investing in individual securities.

This characteristic is fundamental to mutual funds as they are specifically designed to provide a convenient way for individual investors to participate in a diversified investment strategy without needing extensive knowledge or experience in selecting individual securities. The other options do not accurately reflect the nature of mutual funds.