Which Is Better: To Invest In Stocks or Mutual Funds?

I don't think it is about better or not. Investing in anything is about your risk tolerance. You can invest in stock and feel better since you know the stock.

Though owning an individual stock can carry more risk than mutual fund. As you already know, mutual fund consist of many different stocks (20 or more stocks) in a pool. I used to like mutual fund, but I don't like the rigidity of mutual fund such as you can trade during the market hour.

I invest mainly in stock now as well as ETF if I want to diversify. It is more liquid and can be traded easily.

From a diversity standpoint, I would say that for most people it is better to invest in mutual funds, or ETFs, which are exchanged traded funds. In that way, you can own a fund that owns a wide variety of stocks, or you can own a sector that has the stocks that best represent it.

If you are going to own individual stocks, I would say that you want to own at least 5 of them, and that you would want them to all be in different sectors - again trying to have diversity.

To invest in Stocks is up and down business, you may loose your money or gain but in mutual funds you do not loose money that much compared to stocks, it is always safe in MF, if you can go in for risks in your extra money, you can do stocks, if you do not want to take risks, you can do MFs.

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