In this video, I will be going over Investing for beginners 2021 .
When investing, it is imperative as beginners to have solid information to build your portfolio.
If you’ve already determined your target asset mix and account type, you’re ready to choose your investments. Here’s a quick look at 4 common investment products.
When investing, an investment product gives you access to a single asset class or a combination of asset classes. An individual stock or bond exposes you to a single asset class—stocks or bonds, respectively—while a single ETF or mutual fund can expose you to one or more asset classes.
Individual stock
A stock is traded on a major exchange like the New York Stock Exchange or Nasdaq. When you own a stock, you essentially own part of a specific company, and you get some of its assets and profits.
Individual bond
A bond is a loan. When you purchase a bond, you’re lending money to the bond issuer (e.g., a government, government agency, or corporation) in exchange for repayment plus interest by a specified date (maturity).
ETF
An ETF (exchange-traded fund) bundles together many stocks or bonds in a single investment and may track an index. When you own an ETF, you own a portion of its underlying portfolio. An ETF also trades on major exchanges.
Mutual fund (Index Fund)
A mutual fund, like an ETF, bundles together many stocks, bonds, or other securities in a single investment and may track an index. But there’s a notable difference in how you buy and sell ETFs versus mutual funds. ETFs trade on major stock exchanges directly from one investor to another, while mutual fund companies, banks, and brokerage firms buy and sell mutual funds.
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DISCLAIMERS & DISCLOSURES
This content is for education and entertainment purposes only. Tray does not provide tax or investment advice. The information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. All investing involves risk, including the possible loss of principal.
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