Stocks vs. ETFs: focus or diversify? Why not both
Financial freedom begins with knowledge. If you are building a robust portfolio, the key question is: should you bet on the conviction of an individual company stock or the stability of an ETF (Exchange-Traded Fund)?
At Bitso, we know that both options are powerful tools for growing your capital. But the difference between ETFs and stocks lies in the level of control and the fluctuation you are willing to embrace. It’s about leading your strategy and making informed decisions, not blind guesses.
This guide will help you understand the fundamental differences between stocks and ETFs so you can build the best strategy right from the Bitso app.
What is an ETF? What is a company stock?
Individual Stocks
A company stock is a small portion of ownership in a single company. By investing in it, you are expressing your view on that company’s specific future (like Apple or Tesla). Bitso allows you to invest in over five thousand company stocks from the United States and some from Mexico.
- Expected movement: It is concentrated. If the company does not meet its objectives, the impact on your investment is total. It requires more active monitoring and a high-conviction investment thesis.
ETFs (Exchange-Traded Funds)
An ETF is a basket of different elements that trades like a single option. You can, for example, buy an ETF that tracks the 100 largest tech companies or an entire stock index.
- Expected movement: Fluctuations are distributed, which makes their volatility lower than that of an individual company stock. They are an ideal anchor for the stable base of your portfolio.
Volatility and diversification: the main difference between ETFs and stocks
Here is the main difference between stocks and ETFs: the diversification factor.
- Company Stocks: focus and concentrated movement. They require more research and constant monitoring. They are the high-performance athlete running alone.
- ETFs: diversification and lower fluctuation. They are the “relay team” where the poor performance of a single component is offset by the good performance of others. They are ideal for passive and long-term strategies.
In summary:
| Aspect | Individual Stocks | ETFs |
| Diversification | Low (focus on a single company) | High (ETF investment automatically distributed) |
| Volatility | Higher individual fluctuation | Lower fluctuation (ideal for long-term) |
| Monitoring | More intensive (requires constant research) | More passive (tracks the index’s performance) |
If you are an investor who prioritizes stability, or if you are just starting to build your portfolio, ETFs are an accessible entry point that allows you to diversify with less effort.
Which is the best option for me?
Strengthen your strategy: combine and conquer
You don’t have to choose one over the other; you can and should combine them to achieve balance in your portfolio.
- Choose stocks if… You seek to focus your investment on a high-conviction idea (like Apple or Tesla) and are willing to accept higher individual fluctuation.
- Choose ETFs if… You want a solid, automatically diversified foundation, and want to reduce the concentrated movement of a single company, using your investment as a stable “anchor.”
Combine both: invest in stocks and ETFs on Bitso
The simplicity of investing in both on Bitso
At Bitso, we are building a more robust monetary system that empowers people with freedom and control. This means giving you the tools to manage everything with clarity and efficiency.
- Everything in one place: You have access to thousands of company stocks from the United States and international ETFs.
- Accessibility with pesos: You can buy stocks and ETFs from as little as $20 pesos or $1 USD.
- Zero commissions: By investing in stocks and ETFs on Bitso, your capital works harder for you.
Strengthen your investment strategy with Bitso
Financial freedom is not a fantasy; it is a reality built with smart, consistent decisions. At Bitso, we give you the clear knowledge and tools to make that strategy simple to execute.
Invest with strategy. Access thousands of company stocks and international ETFs with zero commissions. Be among the first to invest in ETFs and take control of your portfolio.
It’s time to discover what your money is capable of: join our waitlist and start investing in ETFs and stocks with Bitso.
