Investing in the share market has never been as easy as it is today thanks to share market platforms where everyday investors can invest as little as $10 at a time. Compare that to investing through a share broker where fees make this uneconomic unless you are able to invest a few thousand dollars at a time. Problem with this is that unless one had tens of thousands of dollars to invest then diversification where money is invested in a variety of companies is out of the question.
The solution to this is Index funds, where your money is pooled with those of other investors. The Index fund tracks indices such as the S&P500, Nasdaq, Dow Jones, FTSE, ASX, Dax etc. Expense ratio fees are low and the benefit is that you don't have to pay buy and sell fees to an advisor every time an organisation leaves or joins an Index.
Your money is also now invested in a variety of companies and industry types for diversification and for risk mitigation.
Sharesies is a popular trading platform in New Zealand but is certainly not the only one; Hatch, Kernel, and Invest Now are others. In the US, Robin Hood and Webull are popular trading platforms. In Australia Raiz, Spaceship, CommSec are popular and in the UK you can open a Stocks and Shares ISA which allows you to have a tax efficient trading account.
There are so many benefits of getting involved in the share market in this way with the main one being that it improves your financial literacy. It is all very well just reading books of a financial nature but knowledge comes from action otherwise what you may have learned on paper is just information.
The basic rules of investing still need to be adhered to such as not placing all of your eggs in the one basket and investing according to your goals. If you require the money in the short-term then investing in growth stocks which are high return but with higher risk is not a suitable investment because chances are that the stock price will be down at the time when you need the money.
Micro investing is an excellent way to get involved in the share market. It helps to build your financial know-how, not to mention your wealth.
Femvestorsglobal supports you in all areas of financial education as we help you with the basic fundamentals of investing, we give you everything you need so you have both the confidence and courage to start investing yourself.
So what are you waiting for?
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