How can you beat the Market?

This should one of your aims as an investor. Beat what the market is doing and beat what the banks can offer you. Doing this as an entity and not via ETF’s and other funds is quite tricky. However, 3 simple decisions to increase your return.

If you have less than £500 to invest at once, I would not recommend buying shares. With commissions from £10 to £20 to buy and the same to tell you need to return over 4% to just cover that cost alone at £10 per trade. I would recommend a fund to invest in.

 Do not buy two stocks within the same sector until you have diversified. If that sector is hit with changes in legislation, tax, consumer demand, or more importantly, changes in confidence, it will have a detrimental impact in your portfolio

Do not panic buy or sell a stock on tips or articles you read. Do your research, understand the company. I received a tip off about a company called 88 Energy in an email from a friend who invests. It had risen from to 0.3 to 3.87, from February to the start of the week. That is a return of 1200%. He bought them at the start of the week and its dropped by 30% since then. I chose not to buy as my research showed me something different to his and I was not comfortable with the investment. If I had chosen to buy on a tip I received, my investment profit would have gone from a strong positive position to a negative one within 3 days.

 

The Young Investor 

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About andrepartridge

andrepartridge@googlemail.com
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