Do you need a brokerage or a mutual fund account to execute your investment activities?

Today, discount brokers and mutual fund companies are the primary players in offering investment choices. They both have their pros and cons; hence, it is important to carry out an all-inclusive comparison before investing. They have some similarities given that they are both investment tools but read below the notable differences:

* Their structures are the key difference. Brokerage accounts are not regarded as investments; instead they are termed as accounts for holding investment. On the other hand, mutual funds hold securities.

* Mutual funds have an initial investment fee of about $100 on the lower side and $3,000 on the higher side. Brokerage accounts do not attract any investment to open.

* The operational fees are different too. For a brokerage account, it is all about the trading costs, which involve commissions. For mutual funds, it is all about sales charges.

*A brokerage account is more flexible because an investor can apply multiple security types. This is not possible with mutual funds. According to the Bureau of Labor and Statistics, getting your Bachelor’s Degree is not only a requirement in the industry, but the need to continue learning and staying up-to-date with new programs and technology is just as important.

The following similarities make them more interesting:

* More often than not, they face the same taxation on capital gains, interests, and dividends.

* They both feature diversification though it is heavily determined by the investor who can choose a narrowly concentrated or a broadly diversified type of investment.

*They are professionally managed but only if they are bought from a fully – serviced brokerage firm

The bottom is understanding your investment needs and pursuing them through the right channels.