Stocks vs. Mutual Funds
Stocks
Stocks are shares of ownership in a company. Shareholders are entitled to a “share” in the profits of the company. Those profits are called dividends and are paid to shareholders.
Mutual Funds
Mutual funds are an investment that allows you to pool your assets with a group of people in a diversified portfolio of stocks, bonds, or a combination of stocks and bonds. The assets in the portfolio are professionally managed to achieve a specified investment objective, such as growth or income.
The Difference between Stocks and Mutual Funds
Ownership of individual stocks gives you control over what you own. With a mutual fund you exchange some of that control for the investment expertise of the fund manager. Mutual funds also provide affordable access to instant diversification.
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