There are many advantages of investing in a mutual fund before going in for direct equity investing. The two prominent ones include—natural diversification, which mutual fund investing offers over stock investing, and the lower costs involved when investing in mutual funds compared to stocks. By lower costs we mean that you can buy a stake across several stocks by investing in a mutual fund compared to using the same money to buy only stocks. Treat mutual fund investing like a learner’s license; once you learn the ropes of stock market investing by way of investing in mutual funds, you will have the wherewithal to start investing on your own in stocks as well.