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I recently realised I spend a lot of time warning about the pitfalls of stock-picking and not enough time giving any guidance on what to do instead.
Short thread on how to get started investing with MINIMAL effort, risk or fees >>
Short thread on how to get started investing with MINIMAL effort, risk or fees >>
If you want to start investing and have no idea where to begin, just sign up with a roboadvisor which picks a diverse portfolio based on your risk preference 
Look at Nutmeg, Moneyfarm, Moneybox, Wealthsimple et al.
Look at Nutmeg, Moneyfarm, Moneybox, Wealthsimple et al.
I’ve tried all of them and gave a lot of entry-level information on investing a while ago on my podcast. Listen here:
Investing basics: https://plnk.to/theknowledge/e/1000442584357
Roboadvistors: https://plnk.to/theknowledge/e/1000444575915
Investing basics: https://plnk.to/theknowledge/e/1000442584357
Roboadvistors: https://plnk.to/theknowledge/e/1000444575915
My personal recommendation for anyone new to investing / wants something they can set up once and forget about is Nutmeg ( http://bit.ly/nutmegde ) . In my experience they have the best balance of simplicity/returns.
I’ve used them for a few years and the experience has been
I’ve used them for a few years and the experience has been
Those pod episodes are a few years old (but no less relevant) so I’ll write a proper update in my newsletter ( http://bit.ly/tklettr ) and reupload the podcast eps soon.
Passive investing doesn’t sound as sexy, but diversified passive portfolios beat most active investors.
Passive investing doesn’t sound as sexy, but diversified passive portfolios beat most active investors.
If you’re comfortable with opening and managing your account, the next best thing for a simple investing set up (in my opinion) is opening an account directly with Vanguard / through a platform like AJ Bell which has minimal fees (I use them).
Fees will kill you in the long run!
Fees will kill you in the long run!
<< re last tweet, that’s why I typically don’t recommend platforms with high fees or platforms that actively invest. In my experience (c. 9 years) they rarely consistently outperform passive funds/portfolios.
Aside from Vanguard I pick a few actively managed funds I trust.
Aside from Vanguard I pick a few actively managed funds I trust.
If you want to actively invest, go with a fund (basket of stocks) managed by an experienced fund manager.
If you’re a regular joe/jane, I will be painfully honest - you won’t have the market knowledge or foresight to find alpha (outsized returns) without SIGNIFICANT research.
If you’re a regular joe/jane, I will be painfully honest - you won’t have the market knowledge or foresight to find alpha (outsized returns) without SIGNIFICANT research.
If you don’t have the knowledge to outperform the market, you become the market.
Your best bets are:
1. Passively invest and track the market/a subsection of it (in a diverse portfolio).
2. Trust the expertise of regulated, experienced fund managers.
Your best bets are:
1. Passively invest and track the market/a subsection of it (in a diverse portfolio).
2. Trust the expertise of regulated, experienced fund managers.
Stop listening to Twitter and Youtube gurus. There are very few people I would trust to inform me on where I can find outsized returns. ALL of them spend their entire day at their desk trying to do so.
Don’t listen to any P4P gurus. Good advisors win when you do.
To summarise:
Don’t listen to any P4P gurus. Good advisors win when you do.
To summarise:
TL;DR - if you’re new to investing pick one of these options in order of difficulty/cost:
- Sign up with a roboadvisor like Nutmeg (aff- http://bit.ly/nutmegde )
- Sign up w/ Vanguard / pick a reputable fund on Morningstar
- Find a reputable, regulated fund manager / advisor
- Sign up with a roboadvisor like Nutmeg (aff- http://bit.ly/nutmegde )
- Sign up w/ Vanguard / pick a reputable fund on Morningstar
- Find a reputable, regulated fund manager / advisor
The most important factors when investing are:
Risk - make sure you DIVERSIFY
Horizon - how long you have to invest informs how risky you can be
Fees - don’t be fooled. These add up, so go for the lowest fees/best return blend.
Reputation - don’t give your money to online gurus
Risk - make sure you DIVERSIFY
Horizon - how long you have to invest informs how risky you can be
Fees - don’t be fooled. These add up, so go for the lowest fees/best return blend.
Reputation - don’t give your money to online gurus
