The first thought of a novice investor may be: “should I use all my savings to buy shares of company X, since it is state-owned, stable and works in the oil sector”. Or: “Stocks are a risky business. Mutual funds are strictly regulated by legislation, so I will invest my savings in a mutual fund that has shown good returns in the past years”. Both statements have the right to life, though with reservations.

Indeed, the stock market has been growing throughout its history, but over a long time horizon – 20-30 years. On a short time horizon of one to five years, the stock market is very volatile.
Mutual funds better solve the problem of diversification, but when working with stocks, you will have to diversify your portfolio yourself.

Mutual funds come in many forms, and equity mutual funds are no exception: you can find equity mutual funds that include the MICEX index, or shares of US companies, BRICS countries, etc. Their profitability varies, so you cannot say that a mutual fund brings low or high returns or is unprofitable at all.

Returns on mutual funds, like stocks, change over time.

It is difficult for a novice investor to decide whether to invest in shares or buy units.

In most cases, mutual funds are more preferable for beginners, as they do not require knowledge, experience and almost no time. Shares require more attention and time. But every investor is different, so it is better to seek qualified help from a financial advisor of BCS Premier. He will help you decide on investment instruments based on your risk profile and financial goals.