Whether to invest in stocks or funds may have always been a tangled question for ordinary investors. Today I will give you a brief analysis. For retail investors, what are the advantages of investing in funds over investing in stocks?
1. Professional advantages Every fund company has a large number of professionals, not only financial professionals from top universities, but also researchers from all walks of life. They will conduct special research on several companies in an industry to obtain
Publish professional research reports to provide investment basis for fund managers.
These professional advantages are not available to ordinary investors. Many stock traders do not have the time and energy to understand a company in depth, or even basic financial knowledge. These people plunge into the stock market and become "leeks"
"It's also normal.
2. Scale advantage. Fund size units are calculated in hundreds of millions. If the fund’s profit increases by 0.1%, the profit may reach several million or even tens of millions. Then the fund can use this fund to conduct research or hire outstanding talents.
Talents enable the fund to achieve better development.
However, a 0.1% increase in individual investor profits may only be enough to make a living and not be able to carry out other operations that increase the value of the investment.
3. Channel advantage Some investment projects in the market have thresholds, making it difficult for ordinary investors to access these investment targets.
Institutional investors rarely have investment thresholds that cannot be reached because of their professional knowledge and large amounts of capital.
For example, if you want to invest in Hong Kong stocks, and opening a Hong Kong stock account requires at least 500,000 yuan, you may not have so much money or do not want to invest so much money in Hong Kong stocks. At this time, you can indirectly invest in Hong Kong stocks by purchasing fund shares.
investment in Hong Kong stocks.
4. Information advantage Researchers working in funds are usually people from different industries and have certain work experience in their industries. These people have a relatively in-depth understanding of their industries and have network resources. This provides
Funds provide a broader source of information, and information is of great value in the stock market.
If you master information that the market does not know earlier, you can better understand the trend of stock prices, be more likely to know the timing of buying and selling, and have more opportunities to make profits.
5. Advantages of risk diversification As we all know, Nobel Prize winner James Tobin has a famous saying, "Don't put your eggs in the same basket." This means that the risk of investing in a single stock is very huge, so certain measures need to be taken.
Asset allocation to achieve the role of risk diversification.
It is difficult for ordinary people who have not specifically studied financial knowledge to allocate assets reasonably to achieve the purpose of diversifying risks.
The fund has a professional team to allocate assets and spread risks.
Although funds have advantages over stocks, there are still risks in investing in funds, and many factors need to be considered in how to choose a fund. Investment is not a simple matter.
In addition, we need to be reminded that investment is risky and you need to be cautious when entering the market.