Archive for the ‘Investment’ Category

More Accessible Investing With Social Media

Tuesday, September 22nd, 2015

01 Accessible Investing With Social MediaIn the past ten years social media has become so all pervading that it seems to have seeped into every area of work and personal life.

Dating, socialising, parenting and politics have all undergone the Facebook and Twitter revolutions and now so have finance and investing.

A new app has been developed, christened the ‘Facebook of investing’, which allows investors to share their experience, expertise and knowledge online in much the same way that the social networking site works do.

Risk and Reward

The new app, called Invstr, has been created to help first time investors manage the amount of risk they are exposed to.

The app allows investors to predict the opening and closing prices of shares and to follow them and other investments for several weeks to see how accurate their predictions are.

The function allows investors, who are testing their investment skills, to share information with one another and to share predictions. It gives first time investors a chance to experience the movements of the stock exchange without risking real money.

Investing Money for the First Time

All savvy investors are looking to minimise risk and maximise reward and one of the first and most essential lessons that any cautious investor can learn is prudence and caution.

Being able to see how shares perform over a period of time before committing any real finance to them is a new way of enabling investors to make educated choices.

The Wisdom of the Crowd

Human beings are social creatures; we have developed from the level of primitive tribes to complex societies by working and learning together.

Investing might seem like it is a world away from hunting mastodons in groups, but in reality there are clear similarities.

In our fast paced, digitally connected 21st Century world, we still approach problem solving with stone age brains.

The thought processes we have evolved over millennia, based on our need to cooperate, the thrill of risk and the fear of future scarcity.

We have evolved to learn a great deal from one another, to cooperate and to collaborate and, of course, to trade.

New technologies that enable human beings to interact in the way they have evolved might be the key to enhancing rewards and minimising risks.

Levelling the field

The first time investor is invariably a home investor, risking their own funds and relying on their own luck.

The knowledge, resources and capital in the marketplace of course are concentrated in the hands of professionals and investment firms, with whom the novice must indirectly compete.

Being able to share predictions with other investors might also enable novice investors to level the playing field with major investors and give their investments (when they involve real money), a fighting chance.

Research is the key

It goes without saying (but we have a legal duty to say it anyway), that all investments involve a degree of risk, even when handy new online tools are created to manage it.

Investors who use Invstr to help them research the market should be mindful that no website in the world can offer a risk free investment opportunity and the value of an investment can go down as well as up.

However, any tool that can help to increase the amount of market knowledge an investor has access to will help to inform decisions to purchase, or to pass on investment opportunities.

Investment is often about intuition, judgement, best guesses and hunches.

Many of the world’s most seasoned investors, in their memoirs, have written that their successes have rested on being able to limit the amount of guessing they do.

Invstr might be a useful way of using the wisdom of crowds in order to prevent the panic of the herd from crowding out astute investment decisions.


Tips For A Cautious Investor

Tuesday, July 28th, 2015

investorWith interest rates offering little to get savers excited, now may be a good time to look at other options.

If you are a first time investor, you may be feeling nervous about taking the plunge. That’s fine; there are a range of low risk investments to help you take your first steps into investing.

Here are some tips to get you started.

You’ll Still Need Some Cash (So Make It Work As Hard As It Can)

Having cash to hand acts as a buffer against life’s ups and downs. How much cash you need to keep depends on your situation. Some people like to keep a couple of months’ salary.

That being so, it’s a good idea to make your cash savings work as hard as they can.

From Autumn this year, ISAs (Individual Savings Accounts) will become more flexible. You will be allowed to withdraw and replace money as you wish.

The only condition is that the net contributions stay within the ISA limit for any given year. This means that all or part of your ISA allowance can essentially be used as a standard savings account. It will have the benefit of allowing you to receive interest on your savings without paying tax.

Look At Government-Backed Schemes

Every now and again, governments introduce schemes to encourage saving and/or investing.

At the moment, first-time buyers building a deposit for a house might like to look at the “Help To Buy ISA”. This scheme is due to start in autumn this year. In short, for every £200 saved, the government will add £50, up to a maximum of £3000.

The government also recently ran a “Pensioner Bonds” scheme for over 65s. This is currently closed, but given its huge popularity, it is entirely possible that it will open again.

It’s always worth keeping an eye open for government-backed schemes as they may offer special benefits.

Make Your Investments Match Your Needs

There is a huge range of investment products available.

Instead of thinking in terms of “good” and “bad”, think in terms of “appropriate” or “inappropriate”. In order to decide whether or not an investment is appropriate, you will need to start by taking stock of your current situation.

In particular, you will need to be realistic as to whether you should start investing right now at all. If you have high-interest debts, you may be better to spend any spare cash you have, on paying them down first.

Once you are ready to start investing, you will need to think about your short-, medium- and long-term goals. You will also need to be realistic about your attitude to risk.

You may have heard the expression “the value of an investment can go down as well as up”. This is true. It is also true that some investments carry more risk than others. Some people are happy to accept higher risk for the possibility of higher reward. Other people prefer to take a safer line in their investment strategy.

Of course it is perfectly possible to divide your investment funds between investments with different levels of risk.

Diversification And Dividends – The Two Pillars Of Investment

You’ve probably heard the saying “don’t put all your eggs in one basket”. That often holds true for investments. Putting all your money into high-risk investments creates the risk of losing it all.

By contrast, putting it all into lower-risk investments means you can miss out on some great returns.

By having a mixture of investments of different degrees of risk, you can have the best of both worlds.

Also remember that investments can be for growth or income or a mixture of both. Many listed companies pay dividends to shareholders. These can be reinvested for more growth or used as income.



© 2018 Maxim Wealth Management. Web Design Glasgow Adeo Group