- What is up, happy people?
Welcome to 2021, new year, new wallpaper,
And is anyone else still working their way
through their Christmas chocolate?
And to kick it off today, we are talking about money.
Now, something I often get asked by my friends
and through general comments here with these videos are,
how do I start investing?
Which app do I use to invest?
Which app do you buy stocks from?
How do I get started with investing?
What stocks should I buy?
All of the questions.
You know, I have those same questions around Pokemon cards,
because how can a set of unopened Pokemon cards
from when I was slightly too old for them as a teenager
now be worth like hundreds of thousands.
Maybe today's my lucky day.
I mean, that one's shiny.
If only I knew if these were actually worth anything.
Maybe let me know in the comments
if there's anything good there.
Every day is a school day.
Anyway, on with the learning.
For those of you who are confused, just like me,
hi, my name is Pete Matheson, and on this channel
you can find videos around tech, business, finance.
So if you wanna learn to be smarter with your money,
then please subscribe for more.
First off, what right do I have
to talk about money and investment?
Well, not really any, in all honesty.
I'm not a certified investor or anything like that,
but what I am is very interested
when it comes to managing my own money.
I educated myself when I was younger
with books like "Rich Dad Poor Dad",
and "Rich Dad Poor Dad" again,
"Think and Grow Rich",
"Learn to Earn",
Peter Lynch's "Beating the Street",
all really, really great finance books
which are well-worth a read.
Now, in the last decade, I've also started my own business,
and ended up selling that in March of 2020,
and so that left me with a fair sum of money
which I needed to do something with.
We maxed out my ISA, my wife's ISAs, which here in the U.K.
is basically a tax-free way of saving and investing.
We've thrown some into cryptocurrency.
We've also invested in stocks and shares
outside of the ISA accounts.
Without boasting, and just to show
that I'm putting my money where my mouth is,
we've more than doubled our money.
So if anything, and if you are not yet investing yourself,
please pay attention to this video.
Now there are a tonne of options when it comes to investing,
and since we're talking about something
which you value deeply,
then you'll want to be super, super, mega careful
about what you do with it.
But a wise man once told me that the only person
who will care about your money the most, is you,
and they are 100% right.
So in here, there won't be any talk of things like
which broker to give your pension money to
so they can invest it for you,
take their 1% cut and just never speak to you again.
That happened to me.
We are talking DIY investing for beginners.
So I'm gonna walk you through how to get started,
which apps you should be using,
and which stocks I have been picking,
which I hope will then help you
pick the right ones for yourself.
Before we do get started, let me know
if you're already using any investment apps yourself,
perhaps which stocks you're interested in,
and we can see what everyone else is investing in.
So if you got this far,
then you're probably already interested
in taking your financial life into your own hands,
or at least making a start in investing your money
in a way which we all hope will make you more money,
because one of the worst things you can do
is just put your money in a bank account
and then just wait until you retire.
Why is this? you might ask.
Well, the bank will always pay you less interest
than the inflation rate,
which means that any money saved in a bank
will lose value every year.
The one pound or one dollar you save in your bank today
will buy you less tomorrow.
What does that mean?
Well, let's say you saved 10p in 2005.
That could buy you one of-
Well, it's not one of these,
but imagine this as a Freddo,
because my son ate my Freddo,
but fast forward to 2017,
and the price has tripled to 30p,
so that 10p you saved previously
can now only buy you a third of a Freddo.
Sad face.
Just think about that in a much bigger proportion
in terms of saving for a house or retirement,
and that price change
will really, really sting you over time.
And if you are sitting there watching this
with your significant other
who thinks that investing is a waste of time
and will lose you money,
tell that to my wife,
who has actually made more than double her money
in less than six months
of doing exactly what I'm talking about in this video.
She was super, super against doing this to begin with,
but when she saw the money go up and up over time,
she is now fully converted.
If you don't learn to invest,
then your money is literally getting less and less valuable
the more the years go on.
So the time for you, now,
is to take your own financial wellbeing into your own hands.
But first the caveats.
Let me remind you here that I'm not an expert,
I'm not certified in any way,
and I'm not providing any form of financial advice,
but I am just sharing what I have done over the years,
and what has worked well for me.
Now, my rule here is to always only invest money
that you can afford to lose,
because you should always be aware
that money can go down just as much as it can go up.
Very, very easy to make a bad decision and lose your money.
But if you continue watching, I'll explain
how I avoided these bad decisions where possible.
But I do urge you, don't watch this
and just think it's too risky,
and then flip over to the next video,
unless you're watching this video,
which is where I talk about some less risky ways
that I've invested my money over time.
But overall, I'm what's called a long investor,
and that means you invest in something for the long run,
and you're not put off by the daily ups and downs
that the stock market has.
And yes, this does mean that some mornings,
you'll wake up and see
that the money you've invested yesterday is now worth less,
but you know that over time, this won't matter,
because, fast forward to a month or a year from now,
and the chances are highly likely
that you'll be in profit.
Still with me? Let's continue.
So the first thing you need
to get started with investing your money
is to sign up to a place where you can invest,
and here in the U.K., that means somewhere like
Trading 212 or Freetrade,
and in the U.S. that's probably likely to be Robinhood.
Since I am in the U.K.
and Robinhood have yet to make their way over here,
I have accounts with both Trading 212 and Freetrade.
Now, I don't have anything to sell you here,
and there's no investment course,
but if you are going to sign up
for Trading 212 or Freetrade,
then if you follow the links in the description down below,
then both you and me will receive a free share in return.
No idea what that will be, but, hey,
a free share is just free money.
For me, I do most of my trading with Trading 212,
but I do have a Freetrade for some other trades
that just spread my investments out.
Following that, just some basic admin to start with.
So both trading Trading 212 and Freetrade
are as safe as most banks
in that any money you invest with them
up to, I think it's like 85,000 pounds,
is protected with a guarantee from the FSCS,
which basically means
if the bank or the company were to go bankrupt,
then you would be guaranteed to get your money back.
But I will reiterate that the likelihood of that happening
is very, very rare,
as rare as one of your high street banks going bankrupt.
I do have significant amounts of money invested
in both of these types of accounts,
and I have both transferred money in and out of these apps
without any issues at all.
And then secondly, with Trading 212,
they have three different types of investment accounts.
ISA, Invest and CFD.
ISA is by far the best,
and the first one you want to set up.
Here in the U.K., you can invest
up to 20,000 pounds every year,
and when stored in ISA,
then any profit you make from those investments
are 100% free from any form of tax.
Next, we have Invest, which is basically the same as ISA,
except that this time, you are taxed
on any profits you make.
Now, when I say you're taxed,
nothing actually happens to your money.
Money isn't taken away from you,
but you do need to let HMRC know
if you make any significant profits,
so that good old Her Majesty
gets their cut of your money once again.
And lastly, we have CFD.
Please listen carefully.
Never, and I mean never, open a CFD account,
not unless you're super skilled
and know exactly what you're doing,
because CFD is how Trading 212 make their money,
and it's just like a casino,
where people are putting money in the bets,
but most of the time they lose.
So just, please, don't put your money into CFD.
With that out of the way,
let us actually continue with the actual advice.
Firstly, sign up for a Trading 212 account
as well as a Freetrade account
if you wanna benefit from getting those two free shares
by doing so.
There's no huge difference between them,
but personally, I just prefer Trading 212's layout.
Fund your account with whatever you wish.
If you're not sure what to start off with,
then I suggest with maybe 100 pounds,
or if that's too rich, then maybe 50,
or 10 pounds is still a great place to start.
To do this, you just tap at the number at the top here,
tap on Deposit Funds,
and then you can throw in your card details,
do a bank transfer, or use something like Apple Pay.
And I found the instant bank transfer
and debit card payments
just so easy to use.
So just pick what works for you, and move on.
So now you have your trading app and trading account set up,
the next question is, what do you invest in?
And my advice here is one of two things.
Number one is to invest in blue chip companies.
What are blue chip companies? I hear you ask.
Well, they are the big corporate businesses
who stood the test of time.
We're talking like Microsoft, and Apple, and IBM,
those big companies who've been around
for decades and decades, never skipping a beat.
Even amidst the most difficult financial times
this world has seen so far, with COVID,
these stocks have rallied to all-time highs,
which is just insane.
Number two is to invest in companies
where you absolutely love what they do.
May not be as stable as the blue chip companies,
but they can be the most rewarding if you get it right.
Prime example, Tesla.
Since they've existed, they have fought constant doubt
and ridicule from so many,
but those of us who actually do love what they do
have stayed loyal and have invested over time,
and now there's actually a term known as a $TSLA-naire,
which is basically a millionaire that exists
because they invested in Tesla.
Personally, I am very heavily into the tech sector.
Yes, Tesla, but also Microsoft, Apple, Amazon, Intel, AMD,
and I also have some smaller holdings
across other diversified sectors,
like green energy, Delta airlines, Carnival, Nike.
And, well, generally, the rule of thumb here
isn't to put all of your eggs in one basket,
as you wanna invest in multiple areas
so that if one industry get hit,
say, for example, events or travel industry,
then your overall investment isn't impacted too much.
But with that said,
Tesla have been performing so well for me
that over time, I've been slowly moving lots of my portfolio
over to Tesla,
so I'm very heavily weighted to Tesla.
Once you have picked up what you want to invest in,
then, let's say, Netflix,
then over on Trading 212, tap on Search, type in Netflix,
and this will now show you the current price
as well as historic information on where the price has gone
in the last day, week, month, and so forth.
You can also see whether the market is open or closed,
which is good to know when trading stocks overseas
because of time difference.
And something to note here is
that the stock market is open between normal business hours.
However, a small number of traders on certain platforms
can trade out of hours,
and for most of us traders, this means nothing to you,
but you can't actually do anything about it
unless you find a broker
who will let you trade out of hours.
Now, you might be looking at Netflix and thinking,
"Well, I don't have $523 to buy a share right now,"
but wait, you can afford to buy still,
because you can buy fractional shares,
which means you can buy 0.1, 0.5, or even 0.001 of a share,
if that is all you can afford or all you want to buy.
Simply tap Buy, and then you are given four options,
Market, Limit, Stop, and Stop Limit.
For this video, let's just cover Market and Limit.
So using Market will just go
and buy how many shares you want
at whatever the current price is.
You wanna use this if you're buying fractional shares,
but if you are buying full shares,
then you'll want to avoid this,
because next up is Limit.
With Limit, you get to buy full shares,
and set the price that you want to pay for them,
and this could mean that you want to buy them
maybe cheaper than they currently are,
if, of course, you're prepared to wait,
see if the market drops to that price.
I find, in general, that using this option
will get you a much better price than using Market.
So let's go buy one share of Netflix.
I'm gonna set a limit order for one share,
and I price it at 523.01.
Tap Review Order, then Send Buy Order.
What will happen next is your order is sent to the market,
and you now wait for someone to sell their shares to you
at the price that you've set,
and, of course, for the market to open or close,
depending on what time of day you're doing it.
Now, depending on how quickly that negotiation happens,
you could be waiting seconds, minutes,
or it might just reach the end of the day and never happen
because the market's gone up in price too quickly.
Now, if this happens, then your order will be cancelled
and the money released, ready to place another order.
But you can also tap into the company, scroll down,
and see your pending orders,
which will, again, if you tap on the cross, cancel that,
will immediately free that money up
so you can spend it on something else.
Now you successfully own your first stock.
Congratulations, you have taken your first step
into financial independence.
Give yourself a pat on the back
and wait for the money to roll in.
Well, yes, but, no, but, yes, but, no, but, yes, but-
But now you've invested in a stock,
you want to see how it's doing,
so you would just go into that same name,
and now you'll see how your investment is performing.
Green means good, red means bad.
But what I like about Trading 212
is that it shows you the pricing difference
between the stock price change,
but also the exchange rate,
which really helps when the stock price has gone up,
but you're wondering why you have less money
than you did to begin with,
the one thing to know here,
which does quite annoy me about Trading 212
and most of the other platforms, to be honest,
is that if you sell your shares and then buy back in again
at either a higher or lower price,
it will then calculate your profit and loss
based on each time you make that trade.
So with Tesla, I've actually bought and sold a lot,
and with Trading 212, I've now totally lost track,
because whilst I say I've only made a,
it's still a reasonable profit now,
but I know the vast majority of that money is pure profit
from previous buys and sells.
Now, I know, like I said, I was a long investor,
but I'm essentially long on my main ISA accounts,
and then medium to long, maybe,
on my normal trading account,
as I just like to play around
and sometimes just see what happens.
But for now, you should be focusing on long.
Buy the stock, leave it there until you retire,
and you should be pretty happy.
Finally, and on that note,
the last part you need to know is how to sell those stocks.
It is super simple,
and pretty much just as easy as buying one.
So you tap on Sell, and again, you get the same options,
and I'd go for Market or Limit.
Market, again, sells at the going price,
Limit sells it at the price that you set.
And that is pretty much it, simple as that.
Now you can withdraw the money back into your bank account
or buy back into stocks again
to keep that wheel turning,
making your money work for you
rather than retiring your money to a bank account
where it gets old, and tired, and a bit wrinkly,
and loses value.
So let's just review quickly.
Sign up for a Trading 212 and a Freetrade account,
and with the link down below to get two free shares,
fund your accounts with whatever you want
to get started with investing,
and then go buy shares in either blue chip companies,
which are generally a safe investment,
or find stocks that you're passionate about.
For me, that's Tesla and green energy,
but find something that works for you.
Do let me know if this video was interesting to you,
or if you'd like me to make a more in-depth video
about investing in stocks and shares,
or perhaps one about Bitcoin,
then shout down in the comments down below.
I'd really appreciate if you click that Subscribe button
to subscribe to the channel for more videos like this.
Hit the Like button too.
If you did, that really helps my videos
get seen by more people,
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how I can make your life feel better.
Thanks as always for watching,
and see you in the next video.
Bye-bye