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I’m 26 with £15k to Invest..

September 21, 2015

By Consulting Group

As a young professional in London, my background, goals and time frame are fairly common; I have a basic knowledge of the financial markets, but not enough to beat it consistently, and I place a high priority on saving enough for a house deposit over the next 5-10 years.  But investing is no longer ringing an advisor to pay exorbitant fees; it is low cost DIY services on a mobile or tablet.  I am one of the tech-driven Millennials, so where do I invest my first £15k?

ETFs

I would invest in Exchange-Traded Funds (ETFs) using services such as Nutmeg and ETFMatic.  ETFs are the popular, low-cost way of gaining exposure to the financial markets and services like the above have been developed purely around the use of ETFs.  I don’t have to do anything but deposit my money and periodically check to see how my investments are doing!

Nutmeg is a simple, attractive and transparent service that offers ISA and pension accounts.  I choose my investment amount,  desired risk level for their portfolio (ranked from 1-10) and an optional timeframe, and the portfolio is then fully managed by Nutmeg’s investment team.   Nutmeg is good value, accessible to most (min £1,000 investment) and has an excellent website, but it suffers from lack of an app and the mobile site is very limited.

An alternative approach to ETFs is ETFMatic which, although yet to fully launch, will be the UK’s first ‘Robo-advisor’ that uses algorithms to allocate and re-balance portfolios.  ETFMatic will offer 125 strategic portfolios based on behavioural questions such as preference for capital preservation or profit maximisation.  I look forward to seeing how it competes with the likes of Nutmeg and the incumbents that are rumoured to be developing robo-products.

 Funds

To retain a degree of control of my investments I would invest in funds of my own choice, but there are over 2,500 to choose from and trawling through rating agencies such as MorningStar and TrustNet is daunting.  The Hargreaves Lansdown (@HLInvest) ‘Wealth 150’ however, provides a clear overview of the history, sector and cost of HL’s favourite funds.  Whilst the list is very informative, it isn’t particularly mobile friendly!  Alternatively FundCalibre is an online research centre and fund ratings agency which awards an elite rating to the best performing funds.  Information is presented in a mobile-responsive, digestible way and I can create and buy portfolios through its sister company, Chelsea Financial Services.  In general there are a number of fund comparison tools available to use, but few with user experience in mind.  Purchasing funds can be completed through a variety of online platforms, each offering different levels of service and fees.  Choosing a provider is laborious butBoring Money has compiled an excellent and comprehensive guide that compares providers on usability, service, research, cost, security and choice.

Boring money

Stocks

Finally, to develop my knowledge of the markets, I would pick a number of equities to invest in.   For help choosing the right stocks Simply Wall St has changed the way users can view financial analysis. Currently available on both desktop and mobile, Simply Wall St rates a company on value, expected performance, past performance, financial health and current income.  Its presentation of data in highly visual formats makes a welcome change from the traditional dreary fact sheet.

Simply Wall St

The way people invest is changing and, as demonstrated above, there are a number of tools available to help consumers make better investment decisions, but coming from a company that specialises in product development, it is surprising to see so many website lacking basic mobile functionality.  Overall, I have tried to combine cost, diversification and expertise with a little leftover to aid my own development.

Stocks

Finally, to develop my knowledge of the markets, I would pick a number of equities to invest in.   For help choosing the right stocks Simply Wall St has changed the way users can view financial analysis. Currently available on both desktop and mobile, Simply Wall St rates a company on value, expected performance, past performance, financial health and current income.  Its presentation of data in highly visual formats makes a welcome change from the traditional dreary fact sheet.

The way people invest is changing and, as demonstrated above, there are a number of tools available to help consumers make better investment decisions, but coming from a company that specialises in product development, it is surprising to see so many website lacking basic mobile functionality.  Overall, I have tried to combine cost, diversification and expertise with a little leftover to aid my own development.

 

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