Real estate trade or stock trading – Which is a more viable option?

There are many traders who ask which is better, stock trading or real estate trading. Well, if you ask a financial experts like Nathaniel Glas , he really won’t have an answer as lot of it depends on your preference, personality and style and also comes down to the details of the individual investment. As long as investing is concerned, the main objective is to achieve maximum return and minimizing the risk. With the wide array of investment opportunities in the market, it is not possible to invest in each of them but here in this post, we’re going to discuss the pros and cons of trading the real estate vs. the stock market. 
Real Estate Investment
Investing in real estate will mean buying property or physical land. While some real estate can cost your dollars every month like vacant land, some real estate can also generate cash like rental houses or apartment building. What are the pros and cons of investing in real estate market?
  • People are usually more acquainted with trading real estate than stocks
  • It is a tangible form of investment as you can not just touch it but also live in it
  • Chances of fraud is much less in real estate
  • Safer leverage with real estate as compared to stocks
  • Real estate is an effective hedge against inflation
  • There’s more work required than stocks
  • If the property is left unoccupied, it can cost you money
  • Increase in value of real estate is not much if you bring in the rate of inflation
Stock Investment
Whenever you purchase stocks or shares, you actually purchase a piece of a company regardless of whether the company sells furniture, ice cream cones or manufactures bikes or designs video games. For every stock that you own, you’re entitled to receive a part of the profit. Suppose a company has 1.000,000 shares and you own 10,000 of them, you own 1% of the company. Here are the pros and cons of trading the stock market. 
  • Research shows the stock market to be a consistent wealth creator
  • You can own a part of the business without doing too much of work
  • If the shares of a company pays dividends, the price of the share and dividend will grow over time
  • Diversification of assets is much easier with stocks
  • Stock investment are liquid and hence your money won’t be locked for months
  • Borrowing against the value of the stocks is easier as compared to real estate
  • Stock investment needs an unemotional approach which is tough for traders
  • Fluctuation of stock prices can get risky at a certain stage
  • Dividend paying stocks may seem to have not grown in value
Therefore, depending on the type of investor you are and the risk toleration level that you have, you should decide whether to invest in the stock market or the real estate market. Whichever option you choose, know the ins and outs of trading the market.

Denny Jones

Hey there, I'm Denny Jones, a seasoned financial writer with over a decade of experience. I'm passionate about simplifying finance and empowering readers to achieve financial freedom. My articles offer practical advice and insights to help you navigate investing, budgeting, and personal finance with confidence. Let's unlock your financial potential together!

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