When you’re deciding which type of investment product (or products)—individual stocks, bonds, mutual funds, or ETFs—to hold in your portfolio, it’s important to consider the cost of the investment and the amount of time and effort you want to spend building and maintaining your portfolio. You can build a portfolio with only 1 type of investment product, or you can hold a combination of products.  

There are a few questions you can ask yourself to help make the choice a little easier—see below. Or if you’d rather have an expert build and maintain your portfolio, we’ve got you covered with advice options that can help you reach your goals.

The infographic shows the pros and considerations of investing in individual stocks and bonds, mutual funds, and ETFs. If you want to individually select all of the securities you own, invest in individual stocks and bonds. If you want to make automatic investments or withdrawals, invest in a mutual fund. If you want to invest in an all-in-one fund, invest in a mutual fund. If you don’t have $1,000 or more to invest, invest in an ETF. If you want to know the price of an investment the minute you buy or sell it, invest in an ETF.

Find the best investment products for you:

Individual stocks and bonds
Mutual funds
ETFs (exchange-traded funds)

Need help building a diversified portfolio?

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*Vanguard average ETF expense ratio: 0.06%. Vanguard average mutual fund expense ratio: 0.10%. All averages are asset-weighted. Sources: Vanguard and Morningstar, Inc., as of December 31, 2019.

Notes:

All investing is subject to risk, including the possible loss of the money you invest.

Diversification does not ensure a profit or protect against a loss.

Investments in bonds are subject to interest rate, credit, and inflation risk.

You must buy and sell Vanguard ETF Shares through Vanguard Brokerage Services (we offer them commission-free) or through another broker (which may charge commissions). See the Vanguard Brokerage Services® commission and fee schedules for full details. Vanguard ETF Shares are not redeemable directly with the issuing fund other than in very large aggregations worth millions of dollars. ETFs are subject to market volatility. When buying or selling an ETF, you will pay or receive the current market price, which may be more or less than net asset value.

Vanguard Personal Advisor Services is provided by Vanguard Advisers, Inc., a registered investment advisor, or by Vanguard National Trust Company, a federally chartered, limited-purpose trust company. Vanguard Digital Advisor’s services are provided by Vanguard Advisers, Inc. (“VAI”), a federally registered investment advisor. VAI is a subsidiary of VGI and an affiliate of VMC. Neither VAI, VGI, nor VMC guarantees profits or protection from losses.