A fund is an individual's participation in investing in stocks in an investment trust company.
Stocks are individual transactions.
The fund has a lower risk rate than the actual stock because experts buy many stocks.
Usually, when it comes to stock investment, individuals directly buy or sell through securities companies to earn profits.
For example, it directly deals with Samsung Electronics, KEPCO, and Hyundai Motor.
The fund is a fund that makes it easier for experts to buy these various stocks and invest in one.
That is, the people who call fund managers do the transactions.
to put it simply
You can think of stocks as direct investment and funds as indirect investment.
As mentioned above, the difference between stocks and funds is the difference between direct and indirect investment.
Stocks need to be managed by buying and selling stocks directly
In the case of funds, investment trust companies, which are fund management companies, take care of themselves.
Therefore, if you are not familiar with stocks, it is common to use funds with less risk.
A fund is a form of fund-raising by many investors.
Usually, investment trust companies or asset management companies create funds, which are sold through securities firms or banks, and they operate with these funds.
At this time, the investment expert who runs the fund is called a fund manager.
As such, a fund is also called an indirect investment product because the fund manager is entrusted with funds by individuals.
The fund will invest in various targets such as stocks, bonds, current assets, and derivatives.
The fund company receives a commission of about 1% to 3% per year of the investment, returning all the profits obtained at this time to the investor.
The fund is operated by collecting money from individuals or companies and making profits by buying or selling stocks instead of investors, and returning the profits to investors who entrusted the money.
Fees are typically around 1-2% per year.
In the case of private equity funds, it is sometimes much higher.
Stocks are securities that represent ownership of a company as a unit of capital.
Usually, when you invest in stocks, it's a transaction that buys and sell stocks of a particular company.
A fund refers to investing with funds raised from various investors and distributing performance dividends.
In terms of the nature of the two financial instruments, stocks are direct investments and funds are indirect investments.
If you compare the actual differences...
The price of the fund is calculated based on the closing price after the market closes, although the price of the stock continues to change within the trading hours.
There is also a number of issued shares, but the fund has no limit on the number of shares.
Stocks incur stock transaction fees and taxes when trading, but funds incur annual operating fees.
What stocks and funds have in common is that they come under their own responsibility.
in terms of the number of investment stocks
You can buy one stock each
Funds usually buy tens to hundreds of stocks at once on the management side.
in the form of dividends
Stocks make gains and losses from their own investments
The fund is an unspecified number of aggregated funds, so it gains or losses as much as its shares.
in terms of profit and risk
Stocks have big profits and risks,
The fund is small in both profit and risk.
Stocks are direct investments.
The fund collects funds from various investors and invests them through an expert called fund manager.
So the biggest difference between a stock and a fund is whether it's a direct or indirect investment.
The other difference is
If you invest directly in stocks, you often invest only in stocks,
In the case of funds, in addition to stocks, they also invest in bonds and raw materials.
They're putting a lot of money into bonds in particular.
Therefore, if you are a beginner investor, you can distribute and invest in various assets even in small amounts, and we recommend funds with low risk.
Stocks
Invest only in stocks.
So both the yield and the risk are big.
There are also fees and taxes.
You have to have knowledge of investment because you operate it yourself.
The fund is
Invest in stocks, bonds, etc.
And they buy a lot of stocks or bonds because they're so big.
So both the yield and the risk are small.
Both fees and taxes are included in the fund's return, with an additional operating fee of 1-2% per year.
It's managed by a professional fund manager, so you don't need much knowledge about investment.
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