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Mutual Fund vs Stock Market Investment

 

Most of us are always confused,where to invest in, Mutual fund or Stock market? In simple words, where ever you invest, the money finally comes in the share market only. The only advantage is that in mutual fund, your fund manager decides on behalf of you that in which shares they invest your money while by buying stock, you directly invest in share market, by buying shares of company.

Difference between Mutual Fund vs Stock Market Investment

Mutual Fund vs Stock Market InvestmentBut there are many difference even from the above one, in nature of investment, way of investment, return and many more. So, here we are today discussing about difference between Mutual Fund and Stock Market investment.

Way of Investing

In Mutual fund, you can invest via Mutual fund SIP (systematic investment plan), where amount of money you decide to invest is automatically deducted from your account. if you are small investors than SIP can work great for you. One of the reason why mutual fund investment rise in india is SIP.

But not the same case in stock market. Nope, its not that SIP is not available for stock market, some companies still providing this facility but it is failed poorly. The reason it is failed with stock market is RETURN.

Return

In Stock Market, return is volatile. You can get 20% of return in one day or 50%  of loss in seconds.So, if you are ready to lose or big player you can invest in stock market. While in Mutual fund, mostly termed as safe returns. Yes for 2-3 years of return, it atlest gives you 12-15% for sure.(the reason mutual fund investment is popular).

As in mutual fund, your money is invested in different shares (units basically) and you get return according to that only. Since mutual funds are handled by fund manager (who are highly talented and with high experience).

Potential

As mentioned above, Stock market returns are volatile in nature. If you want high returns (and ready to lose badly) you can go with stock market. Though, no guarantee in mutual funds too for safe returns but in nature, and till date performance, you can consider mutual fund safe.

I have seen many stock markets which gives 1000% return in one year (penny stocks) but mutual fund hardly gives that kind of big return. But mostly mutual fund gives more return than bank fixed deposit.

Daily Monitoring

For stock market investment, you need to keep track of the daily movement of share price. you need to keep check stop loss, which to buy, how much shares to buy and much more. And the reason many stock market investors become full time job of monitoring in stock market.

 

While all the above mentioned work (of buying stop loss) etc are done by your fund manager.so, just pick up the good mutual funds and seat back and chill. You can adopt SIP facility if you want to continue investing in mutual funds.

Class Restriction

In mutual fund investment, you gets lots of options like large cap, mid cap, mix cap, gold bonds,ELSS, mix of equity, balanced and many more. But in case of stock market you are restricted at large cap, mid cap or small cap investment. Overall, Mutual funds are quite flexible in nature while stock market is just opposite.

Your fund manger can invest your money in any appropriate stocks and gives you best return. That's the beauty of mutual fund, not suited with stock market.

These are the difference between stock market and mutual fund investment. Read, think and invest wisely.

Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. IDFC Tax Advantage (ELSS) Fund

4. ICICI Prudential Long Term Equity Fund

5. Religare Tax Plan

6. Franklin India TaxShield

7. DSP BlackRock Tax Saver Fund

8. Birla Sun Life Tax Relief 96

9. Reliance Tax Saver (ELSS) Fund

10. HDFC TaxSaver

Invest Rs 1,50,000 and Save Tax under Section 80C. Get Good Returns by Investing in ELSS Mutual Funds Online

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