Although both funds and stocks are one of the investment methods that investors often use, there are still some differences between them. Among them, funds include trust and investment funds, provident funds, insurance funds, retirement funds and funds of various foundations; Stock is just a kind of securities, and every shareholder uses it as a holding certificate to get dividends and bonuses.

What's the difference between funds and stocks?

1 has different definitions. A fund refers to a certain amount of funds set up for a certain purpose, and shares are ownership certificates issued by joint-stock companies.

2 different risks, the risk of stocks is greater than that of funds. When the stock market falls or the financial situation of the enterprise deteriorates, the principal may be lost. The basic principle of the fund is to combine investment with risk diversification to minimize risks.

3 Different investment methods, the Fund is a securities investment method, and investors do not directly participate in securities trading. Stocks are mostly personal choices, and stock institutions will only give overall investment advice, and the final decision is still in the individual.

4 Different recovery methods, the fund investment has a certain period, and the principal is recovered after maturity. Stock investment is indefinite, and investors may not recover their investment from the company unless the company goes bankrupt and liquidates; If it is to be recovered, it can only be realized at the market price in the securities trading market.

Generally speaking, funds are passive investments and stocks are active investments. Fund is a diversified portfolio investment, which can disperse unsystematic risks, leaving only systemic risks. Simply put, the essence of the fund is the client's financial management, and the stock is selected and purchased by the investors themselves.