Investment Steps for Beginners to Move Smoothly from Core Mutual Funds to Fractional Shares

Hello everyone, this is Koro.

This time, I will explain fractional shares.
Many of you who started investing because of NISA likely began with mutual fund accumulation. I have written 50 free articles so far. This time, I have compiled this paid article about fractional shares, which I especially want beginners to know about.

First, as for typical choices for mutual funds, there are index funds that aim to track indices over the long term at a low cost, such as “eMAXIS Slim All Country” or “eMAXIS Slim US Equity (S&P500).”
This is easy for beginners to get started with, as it involves investing in a wide range of stocks.

On the other hand, active investing involves selecting specific companies or industries to aim for results that outperform the index. Generally, this tends to have higher management costs compared to index investing.
In fact, there are studies showing that many active management funds underperform their benchmarks over the long term.

I have also made numerous mistakes.
I have lost money by buying 100 shares of Japanese individual stocks from companies I didn’t know, and I have also had portfolios where I kept adding mutual funds for India, Europe, bonds, high dividends, and then Indonesia, only to realize in the end that it was just an “All Country” fund. If you over-diversify mutual funds that are already diversified in the name of diversification, your performance will become extremely poor.
Otherwise, my basic plan is to keep my core investments without selling them and only withdraw when absolutely necessary.