Mutual funds, or unit trusts, are a pool of money from a number of investors. You are essentially able to buy a small stake in the mutual fund's underlying assets. By investing as a group with other investors, you may access a larger and more diversified pool of assets than you would as an individual.
Because the various expenses of investing (such as brokerage commissions, custodian's fees etc.) are spread over a larger pool of assets and effectively shared with all the other investors, mutual funds may provide you with a cost effective investment solution.
Another key benefit of mutual funds is that it is professionally managed. You have access to the same expertise as a large institutional investor. Your minimum investable money need only be a few thousand dollars, or even less.