I am not good with money.
All I know is that I go to work, earn the stuff and together with my other half we make enough to make sure there’s food on the table and the lights don’t go out.
But for some bizarre reason – perhaps I’ve watched The Wolf of Wall Street one too many times – the advent of stock trading apps even had me wanting to have a little flutter on the stock market. And anyway…how hard can it be?
The first part of the answer to that is not very. I downloaded investing app – Trading212 – onto my iPhone in seconds, created an account in minutes and popped £50 into it before you can say kerching.
Slightly more tricky, however, was deciding what shares I was actually going to buy – and, believe me, the reasons I have for choosing the companies I did are pretty sketchy.
My first punt was on something I presumed quite sensible: gold bullion. In the dark recesses of my mind something told me that when times are uncertain – you know, with World War 3 potentially around the corner – precious metals are probably a good bet.
Next in my portfolio? Hermes – as in the luxury fashion brand. I can’t afford a Hermes Birkin handbag (£21,000…) but I can now officially say I own something Hermes as I own £5 worth of shares in the company.
As a type one diabetic I inject myself with insulin four times a day – so I decided to purchase Novo Nordisk shares, a company which produces the stuff used by me and millions of others by the bucket load.
Other brands in my portfolio? Pinterest – who doesn’t love a Pinterest zombie scroll? A vape company called Chill Brands and Unilever whose cleaning products I go through like billy-o.
And I’m quite smug to report that my bizarre method of stock selection seems to have borne fruit. I added another tenner and in just over a week the return on my £60 investment was £2.55 (4.27%). It had gone higher than this earlier in the day too – hitting £3.08 (5.15%).
To give this a bit of context, this is probably around the amount I could expect to earn in a whole year in a savings account or ISA with the same level of investment.
James Beckett, a UK-based financial coach and owner of the personal finance website MoneyStocker.com, said: “That amount would buy you a pint pretty much!”
“I would say that you are smashing it so far but don’t put your life savings in just yet! But do keep the experiment going.”
James, however, has some words of caution for me in my quest for Wolf of Wall Street riches.
He said: “It’s extremely tricky to do well on these apps. You are competing against people who do this for a living who are constantly looking at what people are doing.
“You are always going to be up against it and it’s very difficult to get it right. It’s very difficult to be consistent over a long period.”
He explains that my portfolio is small as it contains so few companies and brands – and if one goes under I’m in trouble.
“You are suddenly going to take a big hit. There’s a lot of risk on any investment on a small amount of things,” James explains.
He added: “With such a small number of stocks you might see some very volatile returns.”
But, he says, there IS a way to be less risky in my new found hobby. Instead he recommends putting my money in an exchange-traded fund (EDF) or an index fund. By doing so I’d be investing in hundreds or thousands of different companies rather than just a few, hugely spreading the risk.
He said: “You are essentially buying the whole stock market which is what I do. It helps you to diversify and mitigate the risk. An index fund is a great choice. It’s really easy to do.
“It’s 100% not as exciting and that’s why a lot of people choose to do it themselves. Everyone thinks they can do it better.”
Should I keep going? On that James had some sage advice.
He said: “It helps you to learn about the stock market and that’s what I’m all about doing – I want to get people to invest and grow their wealth.”
So no. I’m not rolling in it just yet – but watch out: one day there might even be enough for that Birkin.