The past decade has seen explosive growth in index mutual funds and exchange-traded funds—and for good reason. These baskets of securities are accessible and versatile, offering the potential for diversified exposure to nearly every corner of the market and often at a fraction of the cost of other investment vehicles.
Does that mean that buying specific equities may soon become a thing of the past? I don’t believe so. For millions of investors, there’s nothing like the thrill of researching and investing in the stocks of individual companies, and the techniques and tools for doing so (like those available at schwab.com/research) keep getting better.
Owning and following individual stocks is also a great way to improve your investing acumen, especially when you’re just starting out.
That’s why I encourage parents and grandparents to gift individual equities to their children and grandchildren. It’s a great way to introduce a young person to the market and—if they’re anything like my family—foster a lifelong passion for investing.
Charles R. Schwab
Founder & Chairman