Stocks, also known as equities, are shares held in a publicly-traded company. Each share grants the shareholder a claim to the company’s assets and profits, according to how many shares are held. Stocks mainly trade on Stock Exchanges around the world, like the New York Stock Exchange or London Stock Exchange.
Bonds, also known as fixed-income securities, are essentially transferrable loans that pay a certain amount of interest for an amount of time. Unlike stocks, bonds do not grant the bondholder a claim to the assets or profits of the company or government that issued them. They instead pay a fixed coupon (the interest) once or twice (or even 4 times) a year to the bondholder, every year, until the bond matures. Unlike stocks, most bonds do not trade on a centralised exchange. Rather they are traded on the Over-The-Counter (OTC) market.
Mutual funds, also known as collective investment schemes, are investment products that pool money from many different investors to allow them to collectively purchase a diversified portfolio of stocks, bonds or other types of securities. Each fund is driven by a specific investment strategy that is decided and managed by a professional Fund Manager. This arrangement allows investors to have a small piece of a well-managed, diversified portfolio. Traditional Mutual Funds are not traded on an exchange. They are bought and sold directly through the fund house that issued them.