It used to be that investing was only for affluent individuals willing to roll the dice. After all, in order to make a decent return on your investment you need to buy in lots of shares at once, say 100 or even 1000. But with modern technology, it’s now possible for anyone to make regular, small investments. Micro-investing services allow even casual investors to manage smaller portfolios that are just as good if not better than the full-sized ones.
What is micro-investing:
Micro-investing is a relatively new term that is used to describe the act of investing small sums of money into stocks or other investment vehicles. Traditionally, investing has been seen as something that is only for the wealthy or for those who have a lot of knowledge about the stock market. However, with the recent introduction of online platforms that are dedicated to micro-investing, anyone can get involved in this type of investing.
These platforms allow you to invest as low as $5-10 dollars per trade, and they provide you with great advice on which stocks are worth investing in. This makes it a great option for people who want to get started in investing but don’t have a lot of money to spare. It’s never been easier or cheaper to take up micro-investing.
What are the benefits of micro-investing:
Several benefits come from micro-investing. The first is that you can start investing with little money, just a few dollars a week or month at a time. This is great for those who have been putting off getting involved in the stock market because they don’t have thousands to plunge it at once. You can establish a level of comfort with investing before you jump in. Once you do, most platforms will allow you to increase your investment amount as your comfort grows.
Micro-investing is also beneficial because it’s easily accessible. Many different platforms offer this type of service, so no matter where you are or what currency you use, you can start investing with just a few clicks. It also requires very little time commitment on your part. All you need to do is find the right stock, purchase it, and track its progress over time.
Are there drawbacks to micro-investing:
Micro-investing only works for certain types of investors. If you don’t like the idea of purchasing individual stocks, this isn’t going to be a good fit for you. It also doesn’t allow you to diversify your portfolio as easily as other types of investing do. You can purchase a few different stocks at once, but you can’t spread your money around if you want to keep your costs low.
Micro-investing also requires you to do the legwork. You need to be able to track your investments and make sure that they are heading in the right direction for you or it won’t be worth doing. If you’re not willing to learn about the stock market, this isn’t going to work for you.
How to get started with micro-investing:
If you’re interested in micro-investing but don’t know where to get started, several online resources can help you. Here are three ideas to get you started:
First, find out what type of investor you are. Are you an active trader or more likely to hold your investments for the long term? If you’re the latter, consider using dollar-cost averaging with your investments. This allows you to invest different amounts regularly (like $50/week) without having to purchase an entire share of stock all at once.
Second, read through micro-investing platforms reviews to find one that works for you. There are quite a few out there, so you can find one that meets your needs.
Finally, consider keeping an eye on certain stocks by using stock-alert services to be notified when stocks are trending in a positive direction. This will make it easier for you to spot potential investments and get involved with micro-investing more quickly.
Avenues to consider when you’re ready to take it to the next level:
When you have more money to invest, you might want to consider diversifying your portfolio or using other investing strategies. Once you reach this point, you will need someone to manage your portfolio so that you can take advantage of your investments. Consider working with a professional who understands the stock market and how to manage different types of portfolios.
You can also switch from buying individual stocks to purchasing mutual funds. Mutual funds are a good place to start if you want exposure to many different types of companies with one single investment. Keep in mind that they have higher fees, however.
Micro-investing is perfect for those who are new to the stock market. It allows you to get your feet wet without investing too much money or time. Once you get more comfortable with the idea of investing, you can manage your portfolio, diversify it, and work with a professional to manage it if needed. There’s never been a better time to start investing your money!