Top investing tips: reduce risk and smooth returns | Personal Finance | Finance

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Newcomers to investing may be apprehensive about the prospect of risking their capital. Making informed decisions as an investor is vital, and to help InvestEngine’s Co-Founder, Andrey Dobrynin, has set out his top tips for making money grow through investing.

Set some goals

“Do you have a specific aim in mind, like a deposit for a house or a retirement nest-egg? Or are you just looking to grow your savings as much as possible?

“Working out your investment goal is a good way to start your investing journey and to provide some discipline to stay the course ⁠— especially when stock markets get rocky.”

Don’t be a fashion victim!

“Beware of getting swept up by investment novelty and fads ⁠— investment crazes come and go, and by the time you’re on board the big gains may have already been made.

“Ask yourself whether you really believe that latest investment “opportunity” will continue to deliver, or could it be a bubble waiting to burst?”

READ MORE: ‘Positive’ news for savers as interest rates across accounts rise – ‘act quickly’

Think long-term

“The reality is in the short-term stock markets are pretty much as likely to fall as to rise.

“But with a properly diversified portfolio, the longer you invest for, the more chance you have of gaining overall ⁠— and beating cash returns. It is why investing should be seen as a long game.”

Don’t be a DIY disaster!

“Many investors like the challenge and excitement they get from DIY investing, but it isn’t for everyone.

“Having a professional investment manager build and look after your portfolio can be a good way to control your investing emotions — whether being swept up in the latest investment mania, or panicking and selling in falling markets, crystallising your losses.”

InvestEngine Founder Simon Crookall adds: “Having an investment goal should help you put together a suitable investment plan for actually getting there.

“Of course, we don’t all have a specific investment aim, but even if it’s just to grow your savings as much as possible, that objective will help you think about what risks you’re prepared to take.

“The rise of free trading apps has made it all too easy for individuals to get caught up in the hype of high-risk investing.

“If you need some help finding the right level of risk for you, consider an investment service like InvestEngine which has a free-to-use online tool that will suggest a managed portfolio that could suit.”

InvestEngine also recently conducted a survey asking what respondents think is the best way to grow their savings.

Participants were asked which methods they would use the most for growing their savings, and over half of them (50.85) percent said they would keep their savings in a savings account.

However, there was also plenty of appetite for investing as a means of boosting one’s savings.

32.77 percent of people said they would invest at a risk level that was right for them, and 27.74 percent were interested in buying and holding investments for the long-term.

Investing in a diversified portfolio was chosen by 21.22 percent of respondents, with 12.2 percent saying they would regularly trade hot/popular stocks and 7.77 percent were prepared to invest in high-risk investments.

Investing in cryptocurrency appealed to 15.24 percent of participants, while just 15.09 percent said they would not use any of the methods listed.





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