A Comparative Study of Investment in Equity Vis-a-vis Mutual Fund

One of the most important and difficult task as a new investor is to make choice between Equity Mutual Funds vs. Individual Stocks. Whether we should invest in equity funds or individual stocks everyone knows there are two distinct ways of investing in equity. One is to choose individual stocks and buy and sell them yourself. The other is to invest through equity mutual funds. The final goal is the same: to benefit from the superior returns that equity investing offers. Choosing between the two kinds of investments depends on a person’s risk taking ability, and returns expectations. It also depends on how much time you have to research your investments, what type of fees and expenses you are willing to withstand.. Mutual funds are essentially investment vehicles where people with similar investment objective come together to pool their money and then invest accordingly. Appreciation and reduction in value of investment is reflected in Net Asset Value (NAV) of the concerned scheme, which is declared by the fund from time to time. Mutual fund schemes are managed by Asset Management Companies (AMC). Market for equity shares, stocks and other fixed income instruments, derivatives and other assets have become mature and information driven. Price changes in these assets are driven by global events.