What Is an Equity Fund Definition Types Benefits

1891 reads · Last updated: December 9, 2025

An equity fund is an investment vehicle that pools money from many investors to be managed by professional fund managers, primarily investing in the stock market. The goal of an equity fund is to achieve capital appreciation by investing in various companies' stocks. Depending on the investment strategy and objectives, equity funds can be classified into actively managed equity funds and passively managed equity funds. Actively managed equity funds involve fund managers actively selecting and adjusting the stock portfolio to achieve returns that exceed the market average. Passively managed equity funds typically track a specific stock index, such as the S&P 500, aiming to replicate the performance of that index.

Suggested for You

Refresh