The investor are in confusion, in to which medium they invest their hard earned money also being novice , since market is a butcher , that never forgive mistakes , and you have will face loss for every mistake you will commit . Then how to make investment wisely, such that there earned money is put to work in best, efficient manner and yield good returns is challenging. Let start the two mediums comparing them in which you as entrant can start and you earn more.
Investing in stocks
- Investing in stock you are free to select your stock in which industry and sector you want to invest , ie metal and mineral, transportation, banking and technology etc
- While stock are concerned you define your own portfolio , let say you have an investment objective of 1 lac you divide it in to 8-10 stocks of 15,000- 10000 each , u reduce your risk of investing in a single stock, or you can invest in either single stock as per your wish, though it is not advisable .
- It is requires proper technical analysis and fundamental analysis on your part and timely evaluating your portfolio on daily basis or weekly basis for some time.
- However if you are not expert you will investment randomly there are chances of huge losses.
- If you work on basis of advisor chances are you end up losing, if you do not find an expert advisor.
- If you become an expert of industry then you can earn good returns from market.
Investing in mutual fund –
- Mutual fund are managed by professional fund managers , who have expertise in this area , and they are heavily paid by mutual fund companies for handling investment
- They handle may thousand or hundred corers of pooled wealth of investor
- They diversify their investment in different portfolios , in different sector
- The chances of losses in mutual fund in less as compared to equity investments yourself
- However they charge fees as little as .01 to 2 percent of investment for their management from investor annually.
It is in the mind set of people that investing in stock if you are learned investor or taking advises gives better return ,but that requires your time and learning the market thoroughly ie fundamental analysis and technical analysis.
However we found investing in equity mutual fund can also give you same return or if you invest in mixed mutual fund that have equity and bond also in their portfolio will give you stable return more than deposits of banks, that you will find more details in our articles further.
if you think you have learned the art of investing than invest yourself , be your on fund manager, there are many in market, earn as much you can on investment because market can make your money 100 percent to 200 percent with your proper delegation , or it will just remain 20 percent.
Otherwise go for Mutual funds .
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