Should you go with Direct stock picking? Or
Should you go with Active Mutual Fund? Or
Should you go with Index Fund?
Time for Small Thread 👇👇👇
Should you go with Active Mutual Fund? Or
Should you go with Index Fund?
Time for Small Thread 👇👇👇
First of all Beware of miss-selling investment products
There are always new and creative ways to sell new funds and products that pay up to the investor emotions
The menu is being changed constantly
There are always new and creative ways to sell new funds and products that pay up to the investor emotions
The menu is being changed constantly
*Direct Stock Picking*
Your chances of picking the winning stock are very small while your odds of picking a loser are fairly large
Even The best investors cannot outperform over every single market cycle
Your chances of picking the winning stock are very small while your odds of picking a loser are fairly large
Even The best investors cannot outperform over every single market cycle
If you can't control your reactions under stressful situations then direct stock picking is not for you
*Active Mutual Fund*
If you are investing for the long term then an active mutual fund's ability to beat the index is very less
Only a 0.07℅ chance that an Active mutual fund could stay on top consistently, while the other 99.93% could not
If you are investing for the long term then an active mutual fund's ability to beat the index is very less
Only a 0.07℅ chance that an Active mutual fund could stay on top consistently, while the other 99.93% could not
All Active funds are not evil
The point is really to show how difficult it is to find consistent outperformers in stock market
Research also shows that most active managers generate returns above their benchmark on a gross basis, but that those excess returns are offset by fees
The point is really to show how difficult it is to find consistent outperformers in stock market
Research also shows that most active managers generate returns above their benchmark on a gross basis, but that those excess returns are offset by fees
* Index Fund
Index funds have a very high chance to beat active funds and Expenses ratios play a big part
And also remember you will never win a lottery ticket by investing in an index fund
But far better than No return or underperforming index
Index funds have a very high chance to beat active funds and Expenses ratios play a big part
And also remember you will never win a lottery ticket by investing in an index fund
But far better than No return or underperforming index
A Good thread already on pure Index fund by @money_theory
https://twitter.com/money_theory/status/1388502429176500231?s=19
Bonus advice: Why do most of the investors fail to bethe at benchmark
Books snippets are from the book
"A wealth of common sense" (A true gem book which I found from the treasure of @unseenvalue)
geni.us/Y7TkcAq
"A wealth of common sense" (A true gem book which I found from the treasure of @unseenvalue)
geni.us/Y7TkcAq
The above thread is inspired by the mentioned book so nothing against anyone or any personal attack
If you like the thread do retweet to spread financial literacy 🤗
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I don't know how to add a catchy title for a thread but this thread is really what you should learn
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