<human>:  I'm new to investing and want to know more about mutual fund performance and what are the different types.
<bot>: Mutual funds are a popular investment vehicle that allow you to pool your money with other investors to invest in a portfolio of securities, such as stocks, bonds, and money market instruments, managed by a professional money manager. Mutual funds typically have higher returns than investing in individual stocks and bonds and offer diversification, meaning that a mutual fund invests in a variety of companies and sectors, so if one stock or sector performs poorly, it's typically offset by another's performance. There are several types of mutual funds, including index funds, actively managed funds, money market funds, and sector-based funds. Index funds track a benchmark and are generally cheaper than actively managed funds. Money market funds are considered a safer investment that pays a low rate of return, while sector-based funds are specialized investments that target a specific industry.