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iiiiiiiii ETFs vs Stocks. WHICH IS BETTER FOR INVESTMENT?
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Table of Content What are ETFs? Types of ETFs What are Stocks? Types of Stocks How ETFs are Different from Stocks? ETFs vs Stocks. Which is Better?
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What are ETFs (Exchange Traded Funds) ? Exchange-traded funds are collection of different types of investments that are pooled together into a single entity. An ETF is called an exchange- traded fund since it's traded on an exchange just like stocks.
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Types of ETFs Let's look at six common types of ETFs: Stock ETFs Bond ETFs Commodity ETFs Industry ETFs International ETFs ETFs to consider for your portfolio this year: Vanguard Australian Share ETF (ASX: VAS),Beta Shares Commodities Basket Currency Hedged ETF (ASX: QCB)
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What are Stocks? Stock is a share in the ownership of a company. Stock represents a claim on the company's assets and earnings. As you acquire more stock, your ownership stake in the company becomes greater. Shares, equity, or stock, it all means the same thing.
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Types of Stocks Blue- Chip Stocks Income Stocks Growth Stocks Cyclical Stocks Defensive Stocks Top ASX stock picks for 2019 : Commonwealth Bank of Australia (ASX: CBA), Reliance Worldwide Corporation Ltd (ASX: RWC), Platinum Asset Management Limited (ASX: PTM)
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How ETFs are Different from Stocks? Risk and Reward: Stocks: Individual stocks can have different risk betas. ETFs: An ETF is slightly less risky Tax Implications: Stocks: They may or may not give tax benefit depending upon the type of stocks. ETFs: ETFs are treated like stock transactions on your tax return, unlike mutual funds and indexes.
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Liquidity Factors: Stocks: Some are very liquid, and others are not. ETFs: ETFs straddle the board, but fewer ETFs are liquid. Transaction Costs: Stocks: Your commissions are based on each trade. ETFs: Your commissions are based on each trade. Ease of Transaction : Stocks: Stocks are easy to buy and sell. ETFs: Exchange traded funds are just as easy to buy, but unlike an index, it’s just one transaction.
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Etfs vs Stocks. Which is better? So, which is better? It depends. ETFs give investors mini portfolios that trade like stocks. It's important to do your research so you can be able to choose a stock or ETF. Keep in mind, that the above comparisons are based on an individual stock versus ETF. The whole game can change if you're considering a custom portfolio of stocks versus an ETF. When deciding whether to pick stocks or select an ETF, look at the risk and the potential return that can be achieved.
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Ready to invest in stocks or ETFs? Check out all recent coverage of stock market news and updates on Kalkine Media. Follow: @kalkineau
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