Choosing between individual stocks and index funds is like deciding between preparing a single dish or an entire thali. Both can satisfy your hunger, but the choice depends on your culinary skills and appetite.
If you’ve mastered the ‘Roots & Wings’ investment philosophy, picking individual stocks could be an appealing challenge. ‘Roots’ refer to robust fundamentals, and ‘Wings’ represent growth potential. Just as cooking a single dish allows you to control every ingredient and spice, investing in individual stocks lets you take direct control and potentially earn higher returns.
But remember, cooking one dish well requires time, dedication, and skill, just like managing individual stocks. On the other hand, index funds or ETFs are like a thali – a mix of several dishes (stocks) that spread the risk and generally offer consistent returns over the long term. The right individual stock, if successful, can potentially result in a multi bagger and get greater compounding results.
