Equity Investments vs. Mutual Fund
Analyze the market conditions carefully with the help of a broker who can guide you towards investing in right stocks.
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Stock markets have been in a highly volatile mood since the beginning of the year. Investors are playing safe as far as equity investments are concerned. Many investors believe that investing in a stock market is all about investing in equity shares at low prices and selling them at high prices at the right time to achieve the expected returns.
This popular belief doesn’t always work because markets keep fluctuating and have tremendous impact on the way trading is done. Regardless of the investment options you have, choosing right stocks is the first step you should take while investing in the stock market.
If you are a new investor, and are uncertain about the kind of stocks you should pick, then you should start with investing money in Mutual Funds or SIPs (Systematic Investment Plans). Mutual Fund Investment is a subject to lower risk as they are tradable securities and can be bought and sold freely, at the current value of the securities invested in.
The money invested in a Mutual Fund Company belongs to you as an individual investor and you can withdraw from the fund at any point of time. This again depends on the kind of Mutual Fund you select. Nonetheless, make sure that you check the track record of the Mutual Fund Company before your start investing.
As far as investing in SIPs or MIPs (Monthly Investment Plans) is concerned, there is nothing like good timing or bad timing. The longer you wait to invest in SIPs, the more complicated it may get for you.
Analyze the market conditions carefully with the help of a broker who can guide you towards opening an account and recommend you the kind of stocks you should select. The broker handles your major transactions; however, you should remain cautious and make the right decision while buying stocks.
Full time investors with a very good risk appetite can take negotiable risks with equity investments. Equity investments include various types of equities that have diverse impacts. One of which is private equity that contains equity securities which cannot be publicly traded. There are many other investment strategies that can be considered and the amount of risk each investor incurs depends on that type of investment.
Mature investors prefer to diversify their investment strategies to be on the safer side. As you can buy multiple shares with a single trading account, you can opt for both short term and long term equity shares.
Start with slow and steady investments and be a safe player. Support your instinct with correct facts by watching the stock market carefully and expect the desired returns on your investment. Thus, it makes more sense for investors to stick to mutual funds at this point of time and have an indirect exposure to the stock market to stay invested for a long term and incur benefits.
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