Finance, Forex and Investments

What is better investing in stocks or mutual funds?

Is it better to choose your stocks to invest in and invest in mutual funds? What are the costs or mutual funds? What are the pros and cons?

Public Comments

1. When you invest in an individual stock, you have a chance you hit a home run and make a lot of money because the company's stock price goes through the roof. Of course it is also possible to buy an apparently good company which then goes to hell and you loose your entire investment (e.g. Enron, GM). For most small investors it is better to buy a no load fund and your only expenses are for management and trading expenses, which could vary from 0.25% to about 2% per year. You can buy sector funds (specific industries) or an index fund, which simulates the entire market, the latter have generally the lowest expense ratios.
2. The above answer is great but for some reason I couldn't give it a thumbs up.