Are conservative financial managers only suitable for funds but not stocks?

with the continuous development of economy and society and the continuous improvement of income, more and more people are eager to invest in financial management. As two familiar varieties, stocks and funds are loved by the public, and there will be some comparison between them. Some people will ask why ordinary people are more suitable to buy funds than stocks.

First of all, what are stocks and funds?

The definition of funds has been discussed a lot before. The funds we usually talk about mainly refer to securities investment funds. Simply put, let professionals help us invest. We give the money to the fund company, and the fund company takes our money to invest in assets that they think are valuable, thus realizing the "benefit sharing and risk sharing" with the fund company. The stock is different. The stock is a certificate of rights and interests issued by a listed company. Simply speaking, you become a shareholder of a company when you buy a stock, so buying a stock is more about buying expectations.

As mentioned above, funds are managed by professionals, and compared with other people, they are more capable of investing. After all, our personal investment ability is limited, but the investment and research ability of fund companies is very strong. People are a team. As for stocks, it is a popular saying in the stock market that one earns two draws and seven losses, and the stock fluctuates greatly, which tests the personal ability of ordinary investors and is unlikely to lose money. Therefore, the risk of the fund is relatively smaller.

There is also a wise saying in investment and financial management, "Don't put eggs in one basket", which I believe everyone has heard, and every investor should abide by. From the essence of the fund, it naturally has the property of diversification by investing in a variety of varieties or directly tracking the stock index, while it may take several or even more than a dozen stocks to invest in stocks, which has a large investment difficulty coefficient.

So relatively speaking, funds can easily diversify investment risks.