Investment options for beginners
Beginners in investing are mostly attracted towards stock market investments as these investments deliver high returns, but these investors fail to understand the amount of risk associated with investing in equities. However, stock market investments are a good medium for beginners to get a boost start but they should begin with investing in low risk stocks.Low beta blue chip company stocks are comparatively safer than small and medium cap stocks with high beta.
Low risk takers should give first preference to savings accounts and CD’s as these are fully secure investment options but these offer interest rates that are very low comparative to returns that can be made from stocks and mutual funds.
Mutual funds provide a good platform for beginners in investing as these increase exposure of investment across financial instruments like stocks, bonds and commodities. These are managed by experienced fund managers, who can be relied upon for making sound investments.
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