I mostly invest in index funds, nice and boring. Occasionally though, to stop myself from going mad on the slow journey to financial independence I like to dive in and buy some single stocks.
Last month I noticed I had a bit too much cash sitting in the savings account earning bugger all interest, I had to put those dollars to work! So I put some more money into squirrel (its a P2P lender, picked up a nice secured 9% loan!), paid $1000 off one of the mortgages (which I’m not really sure was a good idea, but debt reduction is good for my psychological well being) and treated myself to some shares.
I purchased ABA.NZX that is, Abano Healthcare group. They are a company that has interests in audiology, dentistry and radiology. I work in healthcare so I guess I tend to invest in things I am familiar with when I pick out single stocks. I figure the index funds take care of diversifying my investments so I can afford to have a bias with the small amount of money I invest in shares directly. I picked up 145 shares at $6.70 each (paying a stupid brokerage fee of $30). Really I should have waited till I had a larger lump sum to buy shares with to mitigate the fees here. I had been following the company for a while and I thought they seemed pretty good value at this price. The shares are now up to $7.30 a month later, a gain of $87 woohoo! (Edit: its up to $8.01 as of June) For most investors in New Zealand there is no capital gains tax on shares so thats a win. My single stock purchases are buy and holds I’m by no means a day trader, I definitely don’t have the time to do all they research required.
I usually stick to index funds (gotta love those low fees). Smart shares offer a monthly purchase with no brokerage fees! You can also get similar programs from Superlife. This months purchase was $190 worth of MDZ (a NZ mid cap fund) and $100 worth of DIV (a newish fund from smart shares that I’m trying out, its supposed to be divided focused, not that impressed so far!).
These monthly drip feed services have really helped me build up a portfolio before I was really all that serious about achieving FI (Financial independence) and even when times are tough the minimum contribution is only $50 a month. Thats well within reach of most people and its not so hard to sign up if you want to start investing in the sharemarket.