Is it better to buy less of a higher priced, high caliber, solid stock, mutual fund, etc (for example Amazon, Apple, Tesla) or is it better to buy more of an economical lower priced medium caliber stock?
Would you tie dividends into the equation as well?
Target date index fund
It’s better not to try and pick stock but to buy the market with an index fund! If you are buying VTSAX for example, or any S&P 500 fund, you will own stock in Amazon, Apple, etc.
In general, the actual price per share has little to do with much besides your ability to execute the trade (if the price is $50 and you’ve got $40 to spend, price becomes a problem).
Price is calculated very simply as the total market capitalization divided by the number of shares.
If a company is worth $3B and has 1B shares, the price would be $3/share. If they instead had 100M shares, it’d be $30/share. Nothing has happened in terms of the valuation of the company or any investment thesis.
Splits and reverse splits in stocks will frequently adjust the price of shares up or down, mostly to help make trading easier (if a single share is $10K, it can reduce liquidity so a company could break each share into 10 shares and reduce the price to $1K/share).
As far as actual investment recommendations… well, unless you think you can beat the pros, index funds as another poster mentioned might be the smartest choice!
Yes I have been meaning to look into those thank you.
Thanks for your explanation. I’ve heard similar responses just couldn’t quite wrap my mind around it. Makes sense though.
Yeah I have a few indexes and mutual funds however sometimes it’s fun to invest in companies and hold on for the ride. It’s worked out for me in the past however I don’t do it often. I prefer indexes and mutual funds more.