Lux Investing - Should I invest money in Stocks or let it sit in Mutual funds?

Should I invest money in Stocks or let it sit in Mutual funds?

Should I invest money in Individual stocks or just let the money sit in a mutual fund where it earns 4.7 %. If I invest in Stocks which might be the best to invest with with minimal risk

Public Comments

You sound like a conservative investor, so I would say stick with the mutual funds, or possibly find some tax-free municipal bonds that might give you 4 3/4 or more on the investment. Don't pay over par, and remember that the higher the interest, the further out the bond goes. Best of Luck
stick with mutual funds unless you have done the research and can afford to lose what you put into stock if it goes south
If you're happy with 4.7%, you can do almost that well in a bank account. HSBC Direct has an online-only savings account with an interest rate of 4.5%, and that's with no risk at all. (Of course, the rate might go down later. Then again, it might go up.) That might be a good place to put your money while you look into mutual funds. Stock mutual funds can earn 10% or more in the long run, but with more risk than bond funds. Be sure to look at the expense ratio of funds; high ratios (~1%) can really eat into your profits.
Why not read a simple book that will help you descide? Stuart E. Lucas recently woke me up with his book" Wealth"
certificates of deposit are paying around 5% now and are perfectly safe and risk free. Why not do that instead?
It depends. If you are earning 4.7%, in today's market that is not too bad. A lot of mutual funds are doing a whole lot worse. You received a lot of responses from people that advised you to put your money in the bank. Everyone should have a cash reserve. And with the market falling the cash reserve should be increasing. The bank is not the best place to put your cash reserve though. It sould go into T-bills because the interest is shielded from some taxes. 6 mo T-bills are currently paying 5% and the rate is adjusted every 6 months and they can be easily sold on the seconary market if need be. If you have all of your money in just one mutual fund, you may wish to think about diversifying a little and perhaps consider some mutual funds that have a better performance record. One that comes to mind is TDF, a closed end fund traded like a stock. It is up 28% ytd. JFC another is up 30% ytd. CHN another up 40% ytd. They are all funds that invest in China. SWZ up 18% invests in Switzerland. IIF invests in India. It has fallen a great deal in recent weeks and appears somewhat attractive. Here is one that invests in foreign bonds--protection against the falling dollar. GIM up 14%. Also pays a nice dividend. A more mundane fund that invests in U S securities is GAM. It is one of the best performing closed end U S stock funds ytd., up 9.8%. Actually the U S market is not where the real action is. It is other places. Now for stocks. If you have the inclanation to do the research and the ability to avoid the hot issues, then you may wish to consider investing some of your captial in stocks. Some do look quite tempting. CHL for example. The largest cell phone provider in the world. SAY, an Indian company that is now reasonably priced. Even HD and MSFT and WM. But these last 3 have been very weak all year and I suppose there is no reason to suppose that they might turn around any time soon. Even INTC is becoming attrative, assuming that they get their act together. Or how about BAC with its 4.0% dividend taxed at the lower tax rate I might add.
Mutual funds is a safer bet