Website design By BotEap.comStocks vs Mutual Funds

Website design By BotEap.comAre you looking for something you want to commit to? Something that provides real business engagement, which you should invest in stocks.

Website design By BotEap.comMutual funds are great. They help you spread your risk. They provide rest at night. You can buy and hold them for years or actively trade them. They also give you a wide variety of flavors, such as a country or region focus, a sector focus, a commodity focus, and even (high-yield) bonds or hedging options. However, they are always one step away from the real action.

Website design By BotEap.comThis starts with the price and the value of both. Stocks are not only priced, they are also (under and over) valued. The value of a stock can be calculated, and this value gives the rational investor some indication of the risk he is taking in purchasing the security. The value of a fund is difficult to determine or at least less visible to the private investor.

Website design By BotEap.comMore importantly, the shares represent real companies. The moment you buy a stock, you own a SHARE in a company. If you want to know what the search engine business is going to do in the future, you should have bought Google or Yahoo or even Microsoft first. One share is enough to allow you to FEEL what is happening in the market and the options the company takes (for the shares) to grow.

Website design By BotEap.comThe commitment begins the moment you buy the shares. The next steps follow from there; your interest in the company will increase, you will read more about the activities that the company does and what is the strategy. Meanwhile, the price of the shares in your portfolio changes. Then comes the time, once the stock is underperforming the market, when you have to decide; Do I keep it or sell it in search of a better one?

Website design By BotEap.comThere are technical (analytical) tools that could help you make those decisions. They help you lessen your personal (emotional) commitment to that one company and help you look for better alternatives. After which you could end up with a new or different stock in your portfolio. And with that, a new opportunity to gain interest in the company behind the shares.

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