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Young investors should read this

 Equity investing

The problem you have mentioned is that you have had difficulty finding the time to manage your portfolio. First you need to make the distinction between speculating and investing. If you aren’t taking part in speculative trading, you don’t need to be sitting in front of your laptop watching the markets all day.

The time required for investing is in the form of research prior to making an investment. This doesn’t mean you need to monitor your portfolio constantly but rather make good decisions at the outset and practice restraint when you are tempted to react to short term market volatility.

This is where it may be in your interest to appoint a manager with the necessary expertise, who will build and run a bespoke portfolio for you. You want to find one that will allow you to be involved in the stock picking, but also provide guidance.

You have stated that you have learnt a lot so far through trial and error and would like to learn more in future. This would be a great way for you to continue learning, rather than pulling out of your share portfolio completely.

While there would be a fee involved (usually around 1.5{fca2e095024080cfdb77550ebe9d0b9b9b8f127e3d2d431587c2923167dcc9e7} per annum), the manager would hopefully provide a service that would be worth it and may well earn his fee by preventing you from making some costly mistakes. This way you can continue to learn practically, and put in as much or little time as you can afford to.

Whether or not this is a suitable option for you would depend on the value of your share portfolio. If your portfolio is too small at the moment to diversify sufficiently, it would be advisable that you rather go the route of ETFs or unit trusts. This would also apply to the monthly debit order investments that you mentioned. But whichever of these you choose, the same thing applies in terms of prior research and guidance.

One of the benefits of ETFs is that fees are relatively low and you can access a diversified portfolio with only a small investment or monthly debit order rather than a large initial lump sum. You can also choose to have exposure to a particular country, asset, currency or industry.

Your returns will be the average of that sector or type of asset that the fund aims to track, and are unlikely to outperform the market or relevant benchmark. Once again, you need to do some initial research if you are going to start picking ETFs like you pick stocks, and so the time requirement may actually be the same.

You can also consider unit trust funds, which are actively managed by managers who aim to outperform their benchmarks rather than replicate them. There are hundreds from which to choose and each has a different objective, risk profile and asset allocation, so once again, you need to do your research wisely or get some professional guidance.

There is not one solution that suits everyone, and while it is better to be invested than not, making a rushed decision without getting any personalised advice can result in a bad experience that discourages you from investing in future.


The second part of your question relates to property investment, but the same principles apply. It is essential to do your research and calculations, take all the actual and opportunity costs into account, and make sure that what you are buying matches your expectations and requirements.

As far as research is concerned, get to know the property you are considering purchasing. Stick to areas with which you are familiar, speak to different property management companies in that area, arrange for an independent valuation of the property and be willing to walk away at any point and keep searching if it doesn’t seem a good enough opportunity. Rather learn more about what you are looking for by wasting a bit of time in the research phase, than actually buying the property and then realising it wasn’t the right choice.

It is important to set out a plan, taking into account all of the costs associated with purchasing as well as owning the property. These include, but are not necessarily limited to, the transfer duty, conveyancing fees, bond registration costs and initiation fees, rates and taxes, levies, insurance, maintenance, letting agents fees, and estate agent’s fees when selling. Consider the age of the property and potential maintenance that will be needed in future as well.

Work out what you can expect in terms of appreciation in the property price relative to rental income and ensure that the income will meet your needs in order to pay the associated costs. Take into account local vacancy rates which is also something you can speak to a property manager about.

Also consider whether you will appoint a property manager to assist in finding the right tenant and making sure they pay on time. This comes at an extra cost.

In terms of a bond, an access bond would be advisable so that you can register the bond on one property and if you pay it off, you can still use that bond for purchase of your next property. In this way you could save on bond registration costs as you accumulate more properties over time and you are able to leverage off of properties you already own in order to acquire more.

Remember that whether you are investing in shares, ETFs, unit trust funds or property the process is the same. There is no secret formula that will make or break you. It may not be ground breaking advice, but good planning, reliable advice and patience are where your focus should be.