In the UK, there are over 2,000 different unit trusts and in the USA, over 7,500 mutual funds. The investing world is complicated by design after all. Humans love to complicate things, especially when it comes to investing. Warren Buffet’s words are extremely insightful. “There seems to be some perverse human characteristic that likes to make easy things difficult.” There is a time-tested investment strategy that greatly reduces risk, prevents emotional selling, and reduces fees while providing healthy returns. You’re a Financial Thing reader so you don’t have to fall into a fee-paying adviser trap.
But you’re not one of the people with zero knowledge. I’d rather see someone with zero investment knowledge sensibly invest through an adviser than not invest all. You can’t blame grandad’s advice because that is what his trusted financial adviser told him to do the same adviser who was paid handsomely from unit trust and mutual fund front and back end incentives (also known as loads), trading commissions, and annual trailing commissions. You know, the advice about letting a financial adviser build you a unit trust or share portfolio filled Threadneedle, Invesco, Artemis, Shell, Marks & Spencer, Rolls Royce and Lloyds Bank.
#BP TOPTRACKER SERIES#
You can watch the video series here).įorget what your grandad told you. (I’m currently recording a video series on stock picking where I pony up £5,500 of my own cash and try to beat the returns of my index trackers by stock picking. Amature investors tend to panic sell when prices are plummeting and buy when they are rising. The issue is when stock prices are dropping, emotions get involved and bad timing decisions can cost you money. Timing these cyclical stock moves was nearly impossible and required lots of research and luck. Then in early March 2021, tech stocks plummeted and oil and energy stocks rose. For example, up until the end of February 2021, technology stocks were raging upwards.
IF you can correctly identify which sectors are profitable, and which stocks within those sectors are profitable. Stock picking can seem effortless fine during a bull market when prices are going up. Now don’t get me wrong, I like looking into my crystal ball and stock picking (educated gambling) as much as the next person, but there’s too much evidence that most investors and professionals won’t beat the market over a long period of time. The book basically spells out why buying index tracker funds over the long term is far better than stock picking or investing in managed unit trusts and mutual funds, especially if you are a beginner investor. John Bogle’s book “ The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns” was the most impactful investing book I’ve ever read. Join the Financial Thing VIP Investment Group and chat with myself and other like-minded investors
Subscribe to my YouTube channel and press the bell to be notified when new videos are available The Best Tracker Funds ** Updated July 15th, 2021**
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