Introduction to Stocks, Bonds, Mutual funds

Introduction to Stocks, Bonds and Mutual Funds

1. Stocks, Bonds, mutual funds

2. Introduction to Investing Investing is a way to potentially grow your wealth by purchasing assets that could generate income or appreciate in value over time. This can be done in various ways, like buying assets that you expect to increase in value, or by putting your money into something that generates income, like a rental property.

3. What are Stocks? Stocks represent ownership in a corporation. Investors can earn through dividends or by selling shares at a higher price than the purchase. Stock prices can be highly volatile, influenced by economic conditions , company performance, and geopolitical events.

4. What are Bonds? Bonds are debt securities used by corporations and governments to raise capital for projects and operations . Investors earn periodic interest payments, providing a predictable income stream over the bond's term . Bonds are considered less risky than stocks, offering lower but more stable returns over time .

5. What are Mutual Funds? Mutual funds pool money from multiple investors to invest in a diversified range of assets, such as stocks, bonds, and other securities. Investors can easily buy and sell mutual fund shares, offering flexibility and access to diverse investment opportunities. For example, if you invest Rs 500 in a mutual fund with an NAV of Rs 10, you will get (500/10), 50 units of the mutual fund.

6. Key Differences between Stocks, Bonds, and Mutual Funds Ownership : Stocks : ownership stake in a company Returns : Bonds: predictable interest payments, Mutual funds: potential capital appreciation Risk : Stocks: high risk, Bonds: lower risk, Mutual funds: risk level varies based on underlying assets

7. Pros and Cons of Investing in Each Stocks : Potential for high returns, but subject to market volatility and higher risk. Bonds : Stable income stream, but potential for lower returns compared to stocks. Mutual Funds : Diversification and professional management, with fees and less control over individual holdings.

8. Factors to Consider When Choosing Between Them Risk Tolerance Diversification Investment Goals Professional Advice

9. Conclusion: Educate Yourself : Continue learning about investment options and strategies that align with your financial goals . Start Investing : Implement your knowledge by creating an investment portfolio tailored to your risk tolerance and objectives. Regular Evaluation : Periodically review and adjust your portfolio to accommodate changes in your financial situation and market conditions.

10. THANK YOU Reference : gamma.app