Every investment portfolio should contain an interest in the stock market — the question the average investor has to ask is “Can I do it myself?” For those who like to be heavily involved the share market can be fun, meeting with stockbrokers, discussions with friends, reading balance sheets and going to shareholders’ meetings.

Funds Investing

Direct involvement does have some drawbacks. Few people have the time and knowledge to become very involved with the stock market, nor do they have sufficient funds to buy a number of shares for diversification and to minimise risk. The ordinary investor can become emotionally attached to a share and neglect to sell it when the time is right.

By investing in unit trusts an investor can be a part owner of a multi-million rand share portfolio, managed by experts using the latest computer analysis techniques. These managers are experts in their field and have a better chance of picking the right shares than the average investor. Of course the vast spread of shares means that you are unlikely to see the spectacular profits and losses that you may experience doing it on your own.

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