Index Funds vs Mutual Fund | Common Sense Investing Book Summary Hindi
Many people ask me whether they should invest in mutual funds or index funds? Or what is mutual funds for beginners? And what is index funds for beginners? What is the best place to set up SIP, systematic investment plan? Which is better to achieve financial freedom in India. In today's video, we talk about how the smartest people invest their money in stock market (Share market). For example, how Warren Buffett advised where and how the money should be invested after his death. This came from the book - The Little Book of Common Sense Investing Summary and top lessons (Book written by John “Jack” Bogle).
Let's first understand the difference between the index fund and a mutual fund.
The biggest difference between index funds and mutual funds is that index funds invest in a specific list of securities (such as stocks of Sensex, Nifty 50 - listed companies only), while active mutual funds invest in a changing list of securities, chosen by an investment manager.
Over a long-enough period, investors might have a better shot at achieving higher returns with an index fund. Exploring these differences in-depth reveals why.
Key areas of the book:
Starting early and investing regularly is key to enjoying the benefits of long-term compounding.
Understanding investing involves risks, but not investing ensures our financial failure.
Index investing eliminates unsystematic risks, such as concentration, security selection, manager selection, and investment style risks.
Minimizing cost related to investments (including taxes) are essential in the long run.
Beating and timing the market may not work for all.
Respect the uncertainties involved in the future with intelligent asset allocation.
This video has been created to make understand mutual funds and Index funds for beginners along with SIP and you will also learn how to invest in mutual funds and which is better when compared to index funds and get your answer to what is mutual fund vs index funds
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11 май 2023
