Investing in mutual funds vs. direct equities
Investing in mutual funds vs. direct equities One of the top most questions that comes in each and every investor’s mind is among investing in mutual fund scheme or direct equity, what should he or she opt for? Let’s try to answer this question in this article. An equity mutual fund comprises a basket of stocks actively managed by a professional fund manager. However, it is very important for you to understand the fact that investment in a single stock is not equivalent to that of investing in a mutual fund. In fact, you can say investing in a basket of stocks can be comparable to investing in mutual funds. Before we start comparing investing in direct equity stocks and mutual funds, one important thing to remember is that both investment avenues have a risk element. However, mutual funds are considered less risky compared with investment in stocks. Mutual funds provide you with diversification across stocks and sectors. This ensures that you risk is well-spread. When it