Already losing money but hey I clearly need to keep learning and looking for when the stock is in a low point with clear signs it is to rise in the long term; and investing my money at those moments.
With the free trades also being just once a day at the close of the market it seems, it puts more focus into per day value and looking at the value dips and highs over the longer term so I think it will actually help me learn as to know what day of the month to invest over say being concerned with daily/hourly ups and downs.
Iāve Ā£50 coming from my moneybox in a few weeks which will be an additional investment alongside Ā£50 a month. Just need to keep learning about finding the best day of the month to buy for one Iām eyeing up. I think for now Iāll just continue looking at ETFs until thereās at least a few hundred across them. I think others have said the first 1k/2k should be entirely ETFs though too.
If you need personal practical experience to learn this so be it, but make sure you learn the correct way: by keeping notes of every single time you guessed correctly, and wrongly.
What you will find is that, at best, you guess about 50% correctly. Most likely less than 50%.
But if you want to save yourself the time and hassle, Iāll give you the spoiler: it is not possible to time the market.
If there was an hour of the day that it was best to buy shares in, everyone would buy shares that hourā¦ and then it would be the worst time to buy shares, since more buyers means higher prices.
If there was a day of the week, or a month, where shares were cheapest, then everyone would buy shares that day or month, and then it would become the worst day or month.
If you see prices dropping, you have a 50/50 chance of them either falling further, or bouncing back up. Chartists imagine that they can study the past performance, take various factors in to account, find patterns in the rises and falls, and predict āitās going to go up now, not downā.
Academic studies have shown that chartists perform worse than random. They cannot predict the future. They do not know the best time to buy.
Neither do you, nor anyone else.
Thatās really the key take-home point. Unless you have deep insider information that affects a very short term buy/sell decision, you have no edge over anyone else. They have the same information, and they almost certainly have access to it sooner than you, and can act on it orders of magnitude faster than you.
Buying a broad index tracking ETF is a situation where you honestly donāt even need to care what price youāre buying at. Over the long term, intra-day price fluctuations are meaningless. Even intra-year fluctuations will usually be meaningless. Even if you buy at the yearās highest price, youāll still come out ahead over the long term.
The only way you come out poorly is you donāt invest at all (waiting for that ābest momentā to invest).
Which is why the wise investors mantra is ātime in the market beats timing the marketā.
Anyway, you havenāt lost any money yet, and Freetradeās free 4pm trade is just fine for you. If you learn one thing from this experience, itās to ignore that % gains or losses. Just keep investing, and over a long enough time line youāll come out ahead.
Good sir, you have been nothing but gracious with your time and patience afforded to me. I am truly grateful, if only everyone could have this fundamental education then investing wouldnāt be a scary thing for so many (millennial generations that saw bad things in stock markets destroying opportunity for them).
I will indeed continue to put my Ā£50 aside a month at least. I am doing this for the long term, to just add money and let it do itās thing and never touch it unless itās to invest in something substantial far in the future like a home, a business, or maybe not until retirement comes around.
Start now, keep adding to it and donāt get cold feet. Sounds too simple, I love a hands off approach
Just a little update on my investments. Due to adding Ā£50 each month (Iāve had two Ā£50 and one Ā£44 from previous ISA) my options are somewhat limited so Iām focusing on spreading across low cost ETFs.
Iām not sure what my split is here of equity, I think Iām aiming currently for 60/40 but I might go more for growth as Iām not investing huge amounts of my money so the feeling of risk is pretty low plus I just invest it and never touch it.
But other than that Iāve just been trying to buy different ETFs that have good record of growth in my very limited knowledge
One thing Iād point out: thereās significant crossover between many of your ETFs. For example, IUKD will likely contain many of the same securities as ISF. Similarly, there will be duplication between the S&P 500 ETF and IWDG. Thatās fine if intended but, otherwise, you may want to look at allocation first, eg I want X% in the UK and build towards that.
Another thing worth noting: I think Iām right in saying that the MSCI World ETF does not include emerging markets which you may want to consider adding.
Thanks for input. I chose 60/40 split as a recommendation from this useful post:
Iām unaware of crossover in these ETFs, maybe need to look deeper into each before investing. But Iām not all that bothered about it either yet, not quite smart enough in research to what to be looking for.
Iāve noticed the app now splits up āBondā and āStockā ETFs. Very useful! I believe if I aim for having 40% into bonds list, and 60% into stocks list this gives me that balance Iām looking for with 40% in steadiness and 60% into growth.
But getting in on the Ā£ Corp Bond Iāll need Ā£150, so either have to build up some spare cash to do that or look investing elsewhere.
With US fractionals now in, Iām considering it being a good time to get in on Booking.com shares for some long term gains. It seems like an interesting stock as theyāll return again no doubt in future, and a good time to get on it now.
See screenshots of my stocks, I welcome any thoughts on it really. Infant investor right here still.
Iām just gonna be straight up and honest I have no idea what Iām doing, what I should be doing or how I should start. I want to start with Ā£2 I knw sound very little. But as I am not sure yet that to do. I donāt want to go crazy and make a silly decision. Iād be really apperceive if anyone could tell me how they first ever got started and how you made you first trade? And what am I suppose to be looking for. Sorry for all the questions hopefully someone can help me get started.
My first ever āinvestmentā was in Northern Rock. During the financial crisis in which they went under. I know, great skills, right?
When it comes to investing now, I consider some of it a gamble and some of it investing. With smaller companies - whose shares typically have a lower value - who can fluctuate more, thatās gambling to me. I only ābetā what I can absolutely afford to lose. With more established companies, Iām still aware that I could lose it all, but it seems somewhat less likely. Even though it is still entirely possible.
Iād say that if you want to start with Ā£2, pick a company with a low share price - in the pennies or maybe 20 pence a share at most - and research them. Read up on what they do, their share price over time and try to understand the market in which they operate. Then make your investment and see how it goes.
If and when youāre ready to commit more and think this kind of investment is for you, Iād seriously consider opening a Stocks and Shares ISA, as itās a more tax efficient way of doing things. Read up on everything carefully and understand what youāre getting into, of course. But if you think this is a way of reaching your saving goals, look into it.
At that point - and if youāre ready to commit more money/take this seriously - Iād do lots of research again and try to narrow down a list of companies that operate in different markets. Track them for a while, try to understand them and then repeat the above, but make sure your portfolio is diverse.
This is of course not investment advice. Itās just my process. I donāt read company reports, but I try to get a reasonable understanding of a companyās history, what they do and how volatile they are. If it seems like their SP is likely to fluctuate quite a bit - such as Amigo Loans or Deepmatter Group - Iāll invest less and consider it a total gamble. Right now, I invest about Ā£200 a month and split that between some risky companies and some more stable companies who I expect to slowly grow over time. Itās not a lot of money compared to what most are likely investing. However, itās what I can afford to lose and hopefully, the value of my investments will grow a little over time.
I started by using a practice app for about 6 months so I was using fake money whilst looking at how things worked on a basic level.
I also did one of those online investment courses although it is not needed as all the information is available elsewhere or on YouTube.
By the time I went āliveā I still had/have a basic understanding but more importantly for me I understood more about the importance of research.
I follow companies I hold on social media platforms (Twitter/Facebook/LinkedIn) and signed upto vox markets for rns feeds.
I would say if youāre not a beginner do not buy shares (i.e. stock picking) - thatās a fairly advanced strategy. Most people here are clued up so forget that this is something for the few.
This is not advice, but I would personally suggest just investing 60% in an all world stock ETF (e.g. VWRP) and 40% in a bond ETF (e.g. VAGP) - buy little by little each month. This strategy ensures that your eggs are spread across many baskets (diversification & pound cost averaging) and that you will still create a pot that will grow in the long term, but with smaller ups and downs (volatility). Itās called a 60/40 portfolio and it is the quintessential āset and forgetā portfolio that suits most people.
Reading a few books on the subject is always good, but I get that not everybody wants to dedicate as much time to this.
Just be mindful that it is a long term investment (i.e. donāt sell within ~20 years), and you will have to endure ups and downs along the way (risk, volatility, etc).
Thank you so much that was some very valuable information, which I really needed. Iām definitely going to look more into the companies Iām interested in. Iām gathering research Is a big part of investing and youāve given me a lot of the answers Iāve been looking for Really helpful