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Hi Everyone – we are back with Episode 8. This time we wanted to get back to basics and look at one of the key principles of good investing – Diversification.
Why trading isn't investing
Since ‘lockdown’ there has been a boom in retail investors using trading apps to take a first dabble in the stock market. We look at the potential pitfalls of ‘trading’ and compare trading vs. investing.
We look at why first-time investors are often attracted to stock picking and trading rather than long term investing.
Invest in what you know?
We dig into ‘investing in what you know’ as an approach. There is often a misconception that being familiar with brand makes you qualified to invest in that company.
ETFs
We discus how ETFs (Exchange Traded Funds) can provide a convenient way to gain exposure to many companies / investments even if you are only investing small amounts of money.
After we introduce the concept of ETFs we look at some basics of portfolio construction and examine (using data from Blackrock) how a diversified portfolio can outperform the stock market over the long term.
Diversification and Impact Investing
Finally we discuss diversification and impact investing – especially for first time investors and some considerations about the risks of investing in small impact companies or illiquid impact projects.
Blackrock Diversification Page:
https://www.blackrock.com/americas-offshore/education/portfolio-construction/diversifying-investments
Investing without the BS:
https://drive.google.com/file/d/1M15nY9qbXloubOVD2YVNkJ-aVQg_o2cd/view?usp=sharing
Remember when investing your capital is at risk and that this podcast is not financial advice or an offer to invest.
You can contact us at podcast@tickr.co.uk
