Investors are increasingly starting to look outside the American stock exchange for a stable place to put their money. In the wake of the 2008 economic collapse, and the difficult recovery that followed, small emerging holding companies such as the Singapore Exchange (SGX) have risen to the fore, attracting people who no longer considered American business a safe haven. As a result, SGX stock prices continue their upward trend without watering down investors’ interest.

On a small scale, SGX isn’t immune to ups and downs, peaking and falling like any other firm. But the larger picture, which matters more to investors looking for long-term returns, shows consistent growth over the decades. As an example, the company’s net profit by the end of 2010 was $165.8 million, a 7% rise from a year earlier. The quarter before that, its net profit rose 3% to $77 million, and operating revenue went up 6% to $324 million. And although the weekly close rates are slightly down, figures show that that it has been consistently at SGD$7 (USD$5.80) per share or more (adjusted for dividends and splits) since it last peaked in October 2010.

The company’s revenues come from the securities and derivatives market, which account for 75% and 25% of its income respectively. it operates several divisions, each handling a specific market. These include SGX ETS, which handles global trading access and accommodates traders outside Singapore, and SGX DT and SGX ST, which provide derivatives and securities trading.

SGX has close to 800 listed companies, more than half of which are domestic. Chinese listings make up about a fifth of the total, and foreign companies, exclusion Chinese ones, account for a slightly smaller share. Its market capitalization is valued at more than SGD$650 billion (USD$540 billion). Its major shareholders include SEL Holdings, with a 23.45% share, Citibank Nominees Singapore with 15.81%, DBS Nominees with 7.85%, DBSN Services with 5.99%, and HSBC Singapore Nominees with 5.06%.

Although most investments come from the Asia-Pacific region, investment has picked up from other areas, notably in developed Europe and North America. Its recently expanded trading hours have certainly helped attract and keep transcontinental interest. SGX trades from 9am to 5pm with a break from 12:30pm to 2pm, but the nonstop trading scheme implemented in August 2011 will allow people to trade during this “lunch break.” It will also come in handy for those trading in other time zones, and allow investors to quickly respond to news flows.

Most new investors are faced with a basic dilemma: whether to invest in stocks or mutual funds. Both are great ways to grow money, but both also come with considerable risks. Which is a better place to put your money?

There’s no single answer—both have their pros and cons, and it all depends on what kind of investor you are. Several factors come into play, from your budget and risk appetite to how much analysis you want to put into your decisions. So what’s the difference?

An individual stock is a share of a company that’s usually bought through a brokerage. When you’re into stocks, your investment portfolio becomes your responsibility: you decide whether to buy or sell, what to invest in, and how diverse you should make your investments.

A mutual fund, on the other hand, is a group or “basket” of stocks. These are managed for you by an individual or firm called a fund manager. Other investors have a stake in the basket of stocks, so the risk is thinned down—but so are the benefits.

Mutual funds are often recommended for beginners, as it’s more passive and doesn’t require much direct action from the investor. They are also more diversified by nature, so you get a taste of various funds, from technology and retail to foreign indexes and commodities.

However, this diversity is also a weakness. If you invest in a strong company such as Google as part of a mutual fund, you don’t benefit as much from a rise in Google’s stock value because it only makes up a small part of your portfolio. With individual stocks, if you decide to put more of your money in Google, your money will grow faster as Google does.

Stocks don’t only have larger potential returns; they also have lower fees and are simpler to carry out. Most individuals can buy stocks directly through a brokerage and only have to pay a commission upon purchase, as well as a capital gains tax when they sell for a profit. They can choose how many shares to buy and sell, and have the option to reinvest dividends earned from individual stocks.

A common issue that comes into play is loss aversion. A small drop in the value of a mutual fund can be drastic, but even a substantial fall in individual stocks can be easily compensated. If you’re not sure where to invest, think about how much losing your first $1,000 could affect you. The less you’re willing to put at stake, the more you should lean towards mutual funds. When you’re more confident with your investments, individual stocks are a good step forward.

Investing newbies are often advised to start with penny stocks because they’re cheap, accessible, and low-risk. But cheap becomes relative when you take returns into account, and if you read into the business, you’ll know just how much risk you’re getting for your penny. According to an article from The Star, sometimes starting small isn’t the best way to go.

The term penny stock refers to stocks that trade for cheap, usually in small startups with low capital. They don’t literally cost a penny—it’s more like a term to designate the size and stage of a company, according to investment analyst Barry Allan from Toronto.

Many penny stock companies are in the resources industry—oil and gas, precious metals, steel and industrial materials—and are still in the development stages. Biomedicine and technology also have a noticeable presence. They have very few assets, if any, and short or empty track records in earnings.

Contrary to popular belief, there aren’t many beginners in the penny stocks business. The market is mostly made up of people who are already in the industry and know best where to put their money. These investors have much less disclosure than those who invest in the same industries in the mainstream stock market.

Having a relevant background can also help investors deal with the highly speculative nature of penny stocks. Their values can rise and fall several times in the span of a day, and a thorough knowledge of the business is vital to predicting these swings and acting accordingly.

One thing that can work in beginners’ favor is penny stocks’ accessibility. Although they aren’t present in major market trades, having lower volumes and smaller caps, they are easy to find online and don’t require extensive industry connections. Venture capital venues are a good place to look, according to experts.

The risks behind penny stocks are definitely not to be brushed off, however. Mr. Allan compares them to the lottery—decisions are based on scant information and the values can change drastically at the drop of a hat. Even a new marketing campaign can pull a penny investor’s portfolio sharply in a different direction.

The important thing to remember is that penny stocks aren’t a get-rich-quick scheme. Like any other investor, a penny-stock buyer needs to know what he’s buying and protect himself from the risks. Gut feeling isn’t the best of indicators—you’re better off hitting the books and making educated decisions like anyone else.