May 16, 2013
Does the wise investor own individual stocks or stock mutual funds? Why? Where?
Does the wise investor own individual stocks or stock mutual funds? Why? Where?
The wise investor would invest in stock mutual funds. They offer the investor diversification of stocks and have lower costs attached to them. When investing in mutual funds, you want to do it at Vanguard due to the low costs there.
You are correct, Thomas. Being diversified over thousands of individual stocks reduces our risk dramatically. Individual stocks places you at the mercy of any kind of scene and unseen calamity. Stay away from individual stock picking!
Selecting Vanguard is a fine choice as we focus on costs when we do invest our hard earned money. Specifically those boring and oh so efficient no-load index mutual funds. Well done, Thomas!