In the beginning, I again strongly recommend with the same investing requirements, "acquire necessary knowledge and have an investment goal".
As a beginner investor, initially, it is difficult to find the right stocks or other instruments to invest. Here are the best collection of investment instruments for beginner investors to choose and create own investment portfolio.
Exchange Traded Fund (ETF)
If you are a beginner investor, give top priority to invest in the best Exchange Traded Funds.
Until gaining necessary knowledge to invest into the stocks directly, ETF is your best friend! It not only protect your capital, but also eliminate the need of monitoring the investments time to time.
All you the beginner investors needs to do is, find the best performing ETF listed with your stock exchanges and invest systematically, little by little.
Large Cap Equity Mutual Funds
Like equity investment portfolio, investors can build a mutual fund investment portfolio too to create wealth for ling team.
For beginner investors, Large cap and madcap mutual fund portfolio is a best option. Large cap mutual fund provides you the advantages of capital protection to a great level and Mid cap is good for high growth possibility.
Creating a mutual fund portfolio by mixing both in a right proportion is a good idea.
However, identifying the best Large cap equity fund required to do necessary home works. Read the "Ultimate Mutual Fund Selection Guide for Investors" to know how to identify and select the best Mutual funds to invest.
Direct Stocks
Remember, investing to direct stocks required lots of home work to identify the best stocks as well as the right buying price and time.
Read "Excellent Guide to Find and Select Best Companies to Invest" to get knowledge on selection of the best stocks to invest.
As a beginner, limit your investments every time to a certain level than investing huge. Huge investments can be made only upon getting necessary knowledge as well as confidence.
Initially, it is advisable for the beginner investors to focus on reputed Blue chip stocks in the market.
Gold Investments
It is always advisable to the beginner investors to invest a small portion of your capital to the gold. Gold is the best asset class and a complete hedge against inflation and economic crisis.
Investors has several options to accumulate gold little as little through buying physical or paper gold.
Read the article, "How to Invest in Gold? A Guide on Excellent Options to Invest in Gold" to know all about the methods to invest in gold asset.
Real Estate
Real estate investment is also a wealth creator as well as best hedge against inflation as gold investments do. Real estate is always a good choice and there are various methods available to own real estate into your portfolio.
Real estate ETF and mutual funds are th best option for beginner investors to include the Real Estate investment piece to their portfolio.
Nature of a Good Portfolio
A good portfolio should contain the best investments in the right proportion. It should be monitored easily and should not be complicated by lots of small, small investments, a mistake commonly the beginner investors commits. Right instrument, right quantity and right proportion is the advantage of a good portfolio.
Ideally a a good stock portfolio with 15 best stocks and a mutual fund portfolio with ten Mutual funds and ETFs would be fantastic. However remember, creation of an investment portfolio is not a day or month process. It take long years to successfully add the best stocks and mutual funds systematically.
For a real example, it took long 15 years for me to build my own stock investment portfolio. Currently, I have a portfolio with 12 Stocks against planned 15 numbers and 3 stocks are still pending to add and I am in my way to add the remaining three to the stock investment portfolio, but waiting for the right time to buy.
I have a Mutual fund portfolio with 13 different Mutual Funds and 1 Exchange Traded Fund. I am in the process of subscribing another fund that I have identified recently.
Also, I have a habit of buying gold coins and thus having a small portion of gold investments too. I have not invested in Real Estate as of now, but planning to the same in the future and finding out the options to do so.
Recommended Read:
Beginner investors can buy an read below guides to add more knowledge on investing and creating portfolio:
1. The Bogleheads' Guide to the Three-Fund Portfolio: by Taylor Larimore
2. The Bogleheads' Guide to Investing by Taylor Larimore, Barry Abrams
Conclusion
Beginner investors should start investments with small capital until learning all about the investments and getting confidence on how to invest successfully.
Whether it is stock or shares or any other investments, make the investment as little and systematically by identifying option to do so.
Direct investments to the stocks must be done only after getting necessary knowledge on how to find stocks and what are the best qualities of the successful investor.
Remove greed and fear from you when investing in stocks. If you are investing in best stocks and in the best time, there is no need to worry on economic changes and stock market fluctuations.
Reading is the best way to get exact idea on how to do successful stock investments and what are the qualities required by a good investor.
Investing world awaits lots dangers for investors. As a sensible investor, one should detect and avoid such.
Let me know by commenting below once if you need any clarification of have any doubt on any point/s in this article.
Happy investing!
