By YOSEF IBITAYO/ Staff Writer
At the end of my last budgeting article, I mentioned that you should “keep an eye on the investment angle” and that “there’s more to be said about that.”
Well, this is what’s to be said. First and foremost, however, is the need to-
- Start Early
Given the likely age of most people reading, it may be that you’ve already begun dabbling in stocks or crypto over the last few years. However, even if you haven’t, it’s not too late — but the earlier, the better. Due to my father’s insistence on getting myself into investment at an early age, in August of 2008 he purchased a few stocks in Marvel Entertainment, Inc. (MVL). Following Marvel’s acquisition by Disney in 2009, I was able to use the subsequent gain in value as a cash asset in the following years.
For some of you, however, it may be that you don’t have parents or guardians who are as interested in the stock market as mine have been. One thing you could do to alleviate that deficit is to-
- Open an M1 Finance Account
Founded in 2015, M1 Finance is a (mostly) free online brokerage platform that allows you to buy and sell shares in basic stocks, exchange-traded and mutual funds, and other securities. Since December 2017, M1 has not required brokers to pay the fees other platforms charge, like trade commissions, management/advisory fees or mutual fund transaction fees. Instead, they require you to put in an initial $100 after you open an account for free.
Also unlike other platforms, M1 allows brokers to engage in what is known as “fractional shares”. In this, investors can buy just a fraction of a company’s single share for however much money they can spare at the time. Thus, M1 is a good bet for your initial investment platform. If you’re looking to grow your account’s value, however, you need to-
- Keep an Eye on Trends
In order to approximate the knowledge that a person like Warren Buffett or an insider trader has, you have to know and pay attention to the trends in the industries you’re interested in. If things dip down in value, you buy when it evens out. If they rise, you sell. Of course, by not selling before a dip, you risk losing a lot of your portfolio’s value. A semi-counter to this loss can be undertaken if you-
- Diversify Your Portfolio
One of the things I realized over the course of the lockdown was the value of diversification in my portfolio. Most corporations in America took a hit to their stock prices as production ground to a halt. A few securities, however, actually gained in value, notably inverse exchange-traded funds, or inverse ETFs. These ETFs used the downward movement of the stock market’s value to shoot up in their own value.
By investing in these and other sorts of securities, as well as the aforementioned stocks and mutual funds, you shore yourself up against the likelihood of a severe loss in a market downturn. All these tips, however, mean nothing if you cannot-
- Be Consistent
During and after the lockdown, I was more focused on work than investing. As a result, my portfolio remained stagnant in the face of an extremely volatile market.
Don’t make the same mistake I did. Use your resources wisely, utilize the tips I’ve given you, and above all, keep going. Whatever time and money you can put into the stock market, it will give back to you exponentially
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