Investing in the stock market doesn’t have to be complex. Whilst it does always pay to do your homework, there are strategies that can allow someone else to do this homework for you.
This could allow you to minimise risk and maximise return without having to do lots of research yourself. Here are just a few ways investing in the stock market can be made simple.
Hire a broker
Stockbrokers are experts in the stock market who can take your money and invest it for you based on what they believe to be the most lucrative opportunities.
Hiring a broker can be great for those wanting a hands-off approach to investing in the stock market. Brokers charge fees for their service which they may not always disclose unless you ask them – so it’s often worth asking about these fees upfront.
To help find the most reliable broker, it’s always worth reading reviews and testimonials online.
Put your money in mutual funds
Another option is to put your money into mutual funds. This involves contributing money with lots of other investors into a shared fund – this fund is managed by a mutual fund manager who decides where to invest the money to get the highest return.
By investing with lots of other people, you can gain access to investment opportunities you wouldn’t otherwise be able to access. As with choosing a broker, it’s worth doing your research before choosing a mutual fund.
Many mutual funds require you to make minimum contributions every month and the manger will take a share of any returns.
Use an automated trading system
If you don’t trust using a broker or a mutual fund, you could always consider trying an automated trading system. These are computer programmes that decide where to invest your money based on raw data.
This can ensure that there’s no bias to your investment and that it’s based purely on facts and figures. These programmes do come with fees, which is something worth comparing when choosing a platform.
Some of these programmes simply advise you on where to invest, whilst others execute transactions for you. It’s worth reading reviews to find the ones that are most reliable.
For those that don’t have a lot of money to invest with, it’s worth looking into micro-investing, which involves only investing small amounts.
There are apps out there that can invest your spare change – these work by rounding up every purchase you make on card to the nearest pound and then taking this leftover change and putting into an account to invest with.
The great benefit of this form of investing is that you’ll barely notice this money going out of your account making it easier to cope with a loss and more of a pleasant surprise if you do make a return.