Types of investment companies

In the United States, investment companies are classified by the investment company act of 1940 as either unit investment trusts or managed investment companies. The portfolios of unit investment trusts are essentially fixed and thus are called "unmanaged." in contrast, managed companies are so named because securities in their investment portfolios continually are bought and sold: the portfolios are managed. Managed companies are further classified as either closed-end or open-end companies are what we commonly call mutual funds.