1. A mutual fund is a disciplined diversification as a fund manager operates within an institutional framework which enforces certain ground rules of investing, which ensures safety from shocks that may strike individual stocks or sectors.
2. You can invest automatically with fixed small amounts every month, and can also save tax by investing in designated equity mutual funds.
3. In an equity mutual fund, stock trading is done by the fund manager and you don't have a tax liability because you haven't made transactions yourselves, and the tax saved stays as an investment and multiplies in the long-term.
4. A mutual fund investor pays STT only upon redemption of his units, while a stock investor incurs STT both during buying and selling of his shares.
5. A mutual fund investor doesn't require to open a demat account and spend monthly maintenance charges on it (except for ETFs) like a stock investor.
6. A minor cannot be a joint holder of a demat account, but can be a joint holder of a mutual fund account.
7. You need a demat account even if you buy stocks through a broker.
8. If you're not well-equipped to understand different documents of companies, for instance their balance sheets, which have significant repercussions, you shouldn’t invest directly in shares and should opt for equity mutual funds instead.
9. A Balanced Equity fund investor enjoys a mix of Debt and Equity instruments with an auto-balancing mechanism and tax treatment of an equity fund.
10. On the other hand, a stock investor would need to invest and manage both instruments separately on his own without enjoying similar tax benefits on his total invested amount, for long-term wealth creation.
2. You can invest automatically with fixed small amounts every month, and can also save tax by investing in designated equity mutual funds.
3. In an equity mutual fund, stock trading is done by the fund manager and you don't have a tax liability because you haven't made transactions yourselves, and the tax saved stays as an investment and multiplies in the long-term.
4. A mutual fund investor pays STT only upon redemption of his units, while a stock investor incurs STT both during buying and selling of his shares.
5. A mutual fund investor doesn't require to open a demat account and spend monthly maintenance charges on it (except for ETFs) like a stock investor.
6. A minor cannot be a joint holder of a demat account, but can be a joint holder of a mutual fund account.
7. You need a demat account even if you buy stocks through a broker.
8. If you're not well-equipped to understand different documents of companies, for instance their balance sheets, which have significant repercussions, you shouldn’t invest directly in shares and should opt for equity mutual funds instead.
9. A Balanced Equity fund investor enjoys a mix of Debt and Equity instruments with an auto-balancing mechanism and tax treatment of an equity fund.
10. On the other hand, a stock investor would need to invest and manage both instruments separately on his own without enjoying similar tax benefits on his total invested amount, for long-term wealth creation.