Investing with Small Amounts of Money
This question is always asked when thinking about starting to invest and trade in the stock market or forex market: What is the minimum investment required? Is there even such a minimum investment?
This question would have been logical if it had been asked in the past, but now matters have completely changed. You can open a trading account and start investing with ease. You can start with a small amount of money and work toward achieving you own investment goal. Let us explain some options that are on the table, if you want to start investing with a small amount of money.
Online trading brokers
Today, within 10 minutes at most, you can open an online trading account and start trading stocks, forex, CFDs and other various financial instruments with ease. You can also adopt a professional trading strategy, and work to implement it and achieve your investment goal successfully. You can start with a very small amount of money, even as low as $5.
Also, there are apps for online investment, some of which have caused a global buzz over the past few days, due to their impact on the trading market. We’ve all heard about the GameStop short squeeze, and trading apps had had a major role in that.
Most investment apps allow you to buy stocks and build a diversified portfolio of assets and investment funds. The amount of money you spend depends on your budget, the goals you set for yourself, and the time frame you allocate to achieving that goal.
Direct purchase of shares
If your desire is to invest in medium-sized companies or startups, then you must definitely buy stocks directly (what is known as DPPs). The purchasing is done directly from the company itself, without any third party involved in the process. These shares may be limited, so you should keep it in mind and plan ahead.
Mutual funds are the most popular with investors. With a small amount of money, anyone can invest in a fund that owns a number of different shares, belonging to different companies. You can easily get in on it through a broker and start investing in investment fund ETFs.
You have to be smart when investing in investment fund ETFs since the more you buy at once, the more you save on commission value. It is recommended to set a specific goal and amount of money for each investment, and then to work on achieving this goal.
Just the decision to start investing is a step forward in itself. Whatever amount you have brought to the table – or intend to bring to the table - you must take your time in planning your investment goals, time frame, strategy, etc. so that you can become a successful investor, increasing your capital and in the future hopefully diversifying your investments.