Taking the option to go it alone with your investments takes some work. The financial universe is huge and understanding it needs a lot of research and study. For starters, consider unit trusts. In South Africa alone there are over 900 to choose from.
Which one suits your investment plan?
Do you understand the relationship of returns and risk?
Which combinations do you choose?
What weightings do you consider for local and offshore?
Yes, these questions need to be considered carefully to bring meaning to your investment. If you don’t have the time or inclination to research these areas then perhaps a financial planner is the better route.
However, you may want to simplify your plan by investing in the average of certain asset classes. Exchange Traded Funds offer investments in various sectors and asset classes.
They replicate the indexes in the markets.
For example, The Top 40 shares on the JSE by market capitalization. You can invest in quality shares and get the average of their returns. Without having to trade yourself. You simply invest an amount per month or a lump sum and you now track the performance of the 40 shares. They are managed by competent boards of directors ( that’s why they are in the top 40).
The costs are very low ( around 1% per annum) compared to unit trusts ( 2,5%) and share portfolios ( 2%) and you can start with as little as R300 per month.
You will still need to understand what you are doing. There is a lot of information on the websites that offer theses investment, such www.satrix.co.za
where you can invest in assets like gold and property.
Study the fact sheets and understand the nature of these assets.
As a general rule, it’s time in the market that will produce your results.
Shares are for the long term so don’t look for get rich quick results.
Your wealth is created over time with the phenomenal effect of compounding.