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If you hold shares and do not manage them by yourself, you may hold shares in companies with incompetent executives, and you cannot do value-added in the short term. Another limitation is the prices that go up and down every day, making you have to observe the market every day as well because sometimes you can’t stand the losses and decide to sell them to make the price doesn’t go down any further.
The main limitation of real estate is bad liquidity at present. It takes months or years to convert real estate into cash, and real estate investment is specific to each area. If you do this in one place and it is good, it doesn’t mean that it will be good to do at another place because there are a lot of factors that impact it, such as facilities, the convenience to travel to, being near other places or even near the place of work.
All that’s given is just a partial opinion because ultimately, managing everything manually in real estate can be a disadvantage for some people. Some people may say that because of not managing it by themself can make them easily sell or change their shares if it’s not good.
The investment fund on stock investing costs a lot less. You may start stock investing at thousands of baht which is different from the investment in real estate costs at least hundreds of thousands and can be as high as tens of millions or more. Therefore, the first factor to consider is how much money you have. If not much, the stock investment is the answer. If much, you need to compare the worth of the two assets.
Stock funds have much higher liquidity than real estate. Selling funds may take only 10 seconds to complete, but selling real estate can take weeks, months, or years. Therefore, to maintain high liquidity at all times, mutual funds are a better option for people who rush to spend money.
Direct ownership of real estate gives you more power to manage the property such as renovating, transforming, and changing tenants. While investing in stocks, you give right more to the management team that is provided by the fund. You have little right to make management decisions. The most you can do is to wait for the payment. This might be a good thing for you not to have to do any hard work, but someone could consider it as a disadvantage, where they don’t have access to the funds.
Overall, real estate investment is not as stressful as stocks, just buy and wait and use time as proof. On the other hand, stock investment is related to numbers and reports that you have to catch up with daily. Real estate investment has no rules, so you need to learn the basics of land prices, no PE to compare. where is cheaper and where is more expensive and most real estate investments cost a lot of money.
References from
stock2morrow/bingobook
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