Beginner’s guide to investing: The CEO outlines four keys to investment success.
The CEO of Wombat Invest has offered his approach to successful investing because making one’s first investment is undoubtedly the most nerve-wracking investment one will ever make. There are an increasing number of stories about first-time investors who make a big mistake and end up with a hole in their pocket.
While others believe that people learn better through experience rather than education, this is a reality that is deterring many potential investors.
Kane Harrison, the CEO and co-founder of the micro-investing software Wombat Invest, spoke with This page to share what he’s learned over the years.
He added, “Some platforms appeal to advanced investors, while others are more ideal for newcomers.”
“If you’re new to investing and don’t have a lot of money to invest, one thing to think about is how much platforms charge: large charges eat into your profits, so make sure you’re paying a fee that fits your needs.
“Sophisticated tools or access to intricate trading tactics are unlikely to be required, so make sure you pay as little as possible.”
Shares that are fractional in nature
“There was a time when you either had enough money to buy a stock or you didn’t.
“And if you’re a first-time investor, that could be a problem: a single Amazon share costs more than $3,500 today. Alphabet, the parent company of Google, is worth more than $2,500.”
“Even if you have enough money to buy a share of one of these companies, you’re scarcely diversified – your investment fortunes are connected to the price of a single company,” Mr Harrison explained.
Fractional trading is exactly what it sounds like: buying small chunks of stock for less than the price of a single stock.
“You may get exposure to the companies and brands you admire for as little as £10 without having to save up for a whole share.
“And because you may spend such modest amounts, you can afford to spread your risk: for the same price as a single share of Facebook, an investor might build a portfolio of more than 30 companies.”
Buying tiny amounts from a variety of companies immediately diversifies one’s investment portfolio, which is highly advised by some because having a finger in all the pies can lessen overall risk.
Alternatively, you can purchase funds.
“Funds are baskets in general.”Brinkwire Summary News”.