Etfs Vs Stocks. Which is better for investment
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Transcript of Etfs Vs Stocks. Which is better for investment
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ETFs vs Stocks.
WHICH IS BETTER FOR INVESTMENT?
Table of Content
What are ETFs?
Types of ETFs
What are Stocks?
Types of Stocks
How ETFs are Different from Stocks?
ETFs vs Stocks. Which is Better?
What are ETFs (Exchange Traded Funds)?
Exchange-traded funds
are collection of different types of investments that are pooled together into a single entity. An
ETF is called an exchange-traded fund since it's traded on
an exchange just like
stocks.
Types of ETFs
Let's look at six common types of ETFs:
Stock ETFs
Bond ETFs
Commodity ETFs
Industry ETFs
International ETFs
ETFs to consider for your portfolio this year
Vanguard Australian Share ETF (ASX: VAS)
Beta Shares Commodities Basket Currency Hedged ETF (ASX: QCB)
What are Stocks?
Stock is a share in the ownership of
a company. Stock represents a
claim on the company's assets and
earnings. As you acquire more
stock, your ownership stake in the
company becomes greater.
Shares, equity, or stock, it all means
the same thing.
Types of Stocks
Blue- Chip Stocks
Income Stocks
Growth Stocks
Cyclical Stocks
Defensive Stocks
Top ASX stock picks for 2019: Commonwealth Bank of Australia (ASX: CBA), Reliance
Worldwide Corporation Ltd (ASX: RWC), Platinum Asset Management Limited (ASX: PTM)
How ETFs are Different from Stocks?
Risk and Reward:
Stocks: Individual stocks can have different risk betas.
ETFs: An ETF is slightly less risky
Tax Implications:
Stocks: They may or may not give tax benefit depending upon the type of
stocks.
ETFs: ETFs are treated like stock transactions on your tax return, unlike mutual
funds and indexes.
Liquidity Factors:
Stocks: Some are very liquid, and others are not.
ETFs: ETFs straddle the board, but fewer ETFs are liquid.
Transaction Costs:
Stocks: Your commissions are based on each trade.
ETFs: Your commissions are based on each trade.
Ease of Transaction:
Stocks: Stocks are easy to buy and sell.
ETFs: Exchange traded funds are just as easy to buy, but unlike an index, it’s
just one transaction.
Etfs vs Stocks. Which is better?
So, which is better? Actually, it depends.
ETFs give investors mini portfolios that trade like stocks. It's important to do
your research so you can be able to choose a stock or ETF. Keep in mind,
that the above comparisons are based on an individual stock versus ETF.
The whole game can change if you're considering a custom portfolio of
stocks versus an ETF.
When deciding whether to pick stocks or select an ETF, look at the risk
and the potential return that can be achieved.
Ready to invest in stocks or ETFs? Check out all recent coverage of stock
market news and updates on Kalkine Media.
Follow: Kalkine Media