Are you entering the world of investment for the very first time? If yes then you must be having no clue about the share market or mutual funds. This article will give you some information about both these kinds of investment so that you can decide which one is the right way of investment for you.
Mutual Funds: No government agency guarantees this kind of investment. You have to invest your money in any mutual fund you are interested in and that money is in turn invested in different securities, stocks, bonds and so on. Mutual funds in comparison to share market are considered to be less risky and therefore more investors are attracted to it. Obviously mutual funds are more lucrative because you get the opportunity to invest in different financial instruments such as commodities, bonds, stocks etc. Thus the funds give you a diversified investment portfolio and your investment will be less risky. Along with that the mutual fund managers are experts who will try their level best to make your investment profitable.
Share Market: In this kind of investment, you can only invest in one thing that is stock or share. Investors generally do not opt for share market because it involves a lot of risks and you must have an accurate knowledge about the market before you can actually invest in it. Investing in share market will not provide you with a diversified portfolio. Until and unless you are ready to learn the share market trends and keep a close eye on the market, you cannot even think about investing in it because the market is highly unpredictable.
If you are a newbie then the wise move on your part would be to invest in the mutual funds. After you get used to it, you can try out the share market as well.