Foreign stocks are best bought through which of the following?

Investing in foreign stocks through mutual funds is often considered advantageous due to the diversification and professional management they offer. When you invest in a mutual fund that specializes in foreign stocks, you benefit from the expertise of fund managers who are knowledgeable about the international markets. They can navigate the complexities of foreign investments, including regulatory differences, currency fluctuations, and geopolitical factors, which may be challenging for individual investors to manage alone.

Additionally, mutual funds provide instant diversification across a range of foreign companies, reducing the risk associated with investing in a single entity. This broad exposure to various sectors and regions can help mitigate the volatility that can arise in individual foreign stocks.

While other options like exchange-traded funds also provide exposure to foreign stocks, mutual funds are typically favored for those who prefer a more hands-off approach or who wish to leverage the knowledge of professionals in the field. Direct investment, while allowing investors complete control, can be much riskier and require substantial research and knowledge of foreign markets. Real estate investment trusts focus on real estate investments and do not pertain to stocks.