InvestorQ : Do I invest in mutual funds or the stock markets as per the current market condition?
Aastha Awasthi made post

Do I invest in mutual funds or the stock markets as per the current market condition?

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Mary Joseph answered.
6 months ago
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Personally, I invest in mutual funds. Investing in stocks and investing through mutual funds are both ways of creating wealth over a long investment horizon. You can invest in both or either as per your choice, preference, and comfort with the asset classes.

The reason I prefer investing in mutual funds is-

a) It is not as risky an investment as direct stock buying as it is managed by experienced and capable professionals.

b) Buying or selling a stock/company requires extensive research and in-depth knowledge about the company and the sector it performs in. In Mutual Fund, managers have a team dedicated to this research.

c) Mutual funds are diversified. By investing a smaller amount of money, an investor can get a diversified portfolio by investing through mutual funds.

d) Mutual funds help mitigate risks better than stocks as the risk is spread over a larger basket of stocks.

e) Mutual funds are better tax-saving instruments too as one does not have to pay short-term capital gains tax (STCG) if the stocks are sold before 1 year.
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