Learners Quest
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This question arose as I try to understand the different types of investing. There are four main types: bond, stock, mutual funds, and Exchange Traded Funds (ETFs).
The answer can depend on a number of factors. First and foremost is your risk tolerance. If you're like most people, you don't want to put all your eggs in one basket. It's too much risk for your liking and that's okay! But if you feel it's better for you to have a few investments that represent a larger percentage of your portfolio than it is for you to have many smaller investments, then having a small account with fewer investments might be the way to go.
For instance, if you're 45 years old with a retirement savings account of $100,000 and a couple of investments that make up 15% each, you'd probably be okay. But if you're 30 years old with the same amount saved and two investments that make up 5% each, then it's too much risk for you. In this case, a small account might be better for your investment needs.
The answer can depend on a number of factors. First and foremost is your risk tolerance. If you're like most people, you don't want to put all your eggs in one basket. It's too much risk for your liking and that's okay! But if you feel it's better for you to have a few investments that represent a larger percentage of your portfolio than it is for you to have many smaller investments, then having a small account with fewer investments might be the way to go.
For instance, if you're 45 years old with a retirement savings account of $100,000 and a couple of investments that make up 15% each, you'd probably be okay. But if you're 30 years old with the same amount saved and two investments that make up 5% each, then it's too much risk for you. In this case, a small account might be better for your investment needs.
