An equity mutual fund primarily invests in a broad mix of stocks. Equity mutual funds can help you diversify your investment portfolio since the fund will hold many different stocks at the same time.
There are many different kinds of equity mutual funds. Some may invest in only large, medium or small companies, while others may focus on certain industries or sectors. There are also funds that will invest in multiple industries or sectors, and funds that will follow the performance of a specific stock exchange or index.