Day 22 / 31 Discover the 3 Ways to Invest

Day 22: Discover the 3 Ways to Invest
Day 22: Discover the 3 Ways to Invest
Day 22: Discover the 3 Ways to Invest

There are generally three different ways to invest in a stock market and today you’ll find out about the advantages and disadvantages of each approach.

Handpicking shares

Firstly you can handpick your own shares, meaning you select one or a few companies you want to invest in, buy their shares and wait for the magic to happen. The key advantages as well as disadvantages are summarised below. Continue reading “Day 22 / 31 Discover the 3 Ways to Invest”

Step 50: Investing through Handpicking shares

Step 50 of the 100 Steps to financial independence: Investing through Handpicking Shares
Step 50: Investing through Handpicking Shares

Now that we’ve discussed the what of investing (stocks and bonds and what the differences between the two are), it is now time to learn more about the how of investing and in particular how one can enter the stock market and start investing. Hopefully by now you’ve at least become slightly curious about how this investing really works, whether or not you feel like this will be your thing to do.

Generally speaking there are three different ways you can invest in a stock market:

  1. Handpicking shares (and bonds) of individual companies
  2. Getting a collection of shares and bonds through collective or mutual funds
  3. Passive investing through Index tracking or Exchange Traded Fund

We’ll look at each option in turn to find out more about each way of investing in detail. In this step we’ll start by looking at handpicking shares of individual companies. Remember that these steps are only an introduction to the complexity of investing, so don’t just take my word for it, but read up if you’d like to find out more. There are many good books, articles and websites around that will explain this all in greater detail.

To make things easier on me as well as on you when reading, I have decided to talk about “handpicking shares” where in reality I am talking about both shares and bonds (yes, you can call me lazy if you want..!) Continue reading “Step 50: Investing through Handpicking shares”