For anyone starting out in investing in shares, this is probably the most asked question. The problem is, there are no perfect answers to this, and that is the challenge of using shares as an investment. The reality is that with thousands of companies to choose from, all with the potential for different levels of risk and return, there is a unique answer for every investor.
It is easy to forget that as investors, we are all different and this is very important in share investment. We all view risk differently, and we all have different goals for our investment strategies. The best shares to invest in are those that fit each person’s risk level and that will achieve their investment goals.
That means assessing what you want from your investment and planning accordingly. Research and analysis on companies, to find those that fit your risk levels and have the potential returns you want to take time, but that really is the way to find the best shares to invest in.
However, we can think of share investment strategies in a broader sense. Building a robust portfolio means balancing risk and reward. That means using established businesses for a low return, lower risk base, and balance that with a portion of higher risk and potentially higher reward shares too. The ratio of lower and higher risk shares will depend on the individual’s risk preferences. One exception to this is that every share portfolio should include long term share investments in established brands that pay dividends. This is the best option for building growth over a longer period, 20 to 30 years or more, which should provide a small annual income while building growth for retirement.
For those unfamiliar with share investments, choosing the right shares can obviously be difficult. Here, a managed account or a stockbroker service that offers guidance to help identify the shares that may provide the results you want can make a lot of sense. It takes away control, but it builds a portfolio that reflects an individual’s needs.
For those that prefer to stay hands-on, there is a lot of information available today on both individual shares, the companies they are associated with, and overall economic performance. Data that used to be confined to professional traders are now available, often for free, to home investors. In that sense, we have more tools than ever to find the very best shares to invest in. It does take time though, so for those that wish to do everything themselves, it is important to have the time available each week to assess your investment positions.
There may be no single answer to finding the best shares to invest in, but there are many tools and options that will allow an investor to create the right blend of risk and reward for their needs. The ability to invest in shares has been made much more accessible in recent years, and with some planning and assistance where required, investors can build a successful portfolio that achieves their goals.
For the full breakdown of investing in shares check out our article: Investing in Shares
We welcome you to give our team a call to discuss your investment goals and objectives.
You can call Walker Capital Australia on +61 2 8076 2210, and we’ll see how we can help you achieve your investment goals.