Question
Hey Mike,
Hope you had a great weekend.
I’ve been interested in investing my savings but I don’t even know where to begin. I figured you might be someone who can lead me in the right direction.
I think the big question for me is what should I look into investing in? Right now I have small investments through an app and I don’t really know much about it.
C.
My response by email before our call
Hi C,
There are more resources on investing than ever which makes it very difficult to determine how to proceed. Investing can also be as simple or as complicated as you want it to be. So the first decision is do you want it to be easy and done for you or are you willing to put in some work to try for better results and for more entertainment value?
The following will help you get started.
How much do you have to invest (investable assets)? In my opinion, if you don't have more than $500k you should do it yourself with ETF's
If you have sizeable assets and a complicated financial condition, you should hire a professional and I'll be happy to recommend someone that can help.
How much time do you intend to devote to your investment activities? In my opinion if you don't have time to do the analysis and trading, you should use a robo advisor that will automate the rebalancing. 12 Best Robo-Advisors of January 2021 - NerdWallet Also, if you don't have time, you should follow a risk scale for diversification. However at your age, you can be quite aggressive. Looking at this chart from the standpoint of age, you would look at it backwards starting at old age for short term investments and decrease the age as you move right.
If you have time and want to make your own investment decisions, I suggest you take an investment course if you are unfamiliar with how the markets work, how to analyze individual companies, how to optimize and manage a portfolio, and how to properly diversify your holdings that fit your risk tolerance.
https://www.morningstar.com/Cover/Classroom.html
https://www.ce.ucf.edu/Program/Stocks-Bonds-and-Investing-Oh-My
If you have time and want to invest in individual companies and ETFs but don't want to take a course look into the following
MotleyFool.com
AAII.com
There are many quantitative and analytical tools available, some free or low cost, that will help you screen, analyze and select investments on your own. There will be a learning curve if you aren't familiar with how they work.
I’m affiliated with Equities Lab.
TD Ameritrade’s Think or Swim platform is really good for both analysis and investing
MarketSmith by IBD.
You can do a combination of all of this and you don't even need a large sum of investable assets to do it. This strategy would be called diversifying your strategies😊
That's probably enough to get you thinking.
Mike