The 1990s have seen unprecedented growth in mutual funds. Shares in the funds now represent a major part of household wealth, and the funds themselves have become important intermediaries for savings and investments. In the United States, more than 4,000 mutual funds currently hold stocks and bonds worth a total of more than $2 trillion (Chart 1). Household investment in these funds increased more than fivefold in the last ten years, making it the fastest growing item on the household financial balance sheet. Most of this growth came at the expense of more traditional forms of savings,Particular Bank Deposite.
