Invest In Stocks If You Understand Market Well

QUERIES

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PRIYA SINHA, email

I want to invest in equity. Should I choose equity mutual funds or invest directly in stocks? If I go with stocks, should I open a demat account with a zero-brokerage platform or a full-service broker? How are they different?

Mutual funds offer diversification, professional management, and suit long-term goals even with small systematic investment plans (SIPs), making them ideal for beginners.

Investing in direct stocks offers potentially higher returns and zero expense ratios, but requires significant market understanding and analytical and research skills. They also carry higher risks. For newcomers, a better alternative is to start with index funds to understand stock markets, before attempting to invest in direct equities.