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‘It's never been easier' to start investing says Barnaby Cecil founder

Daily Express logo Daily Express 27/07/2021 Samantha Leathers
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Investing, whilst heavily reliant on research and market knowledge, also includes a fair amount of guesswork to estimate future trends. Looking at past trends in the investing sector can help inform this guesswork a little more, as found and financial planning director of Barnaby Cecil Thomas Skinner explains.

Investment methods, platforms and strategies have seen a range of changes over the last three decades and many first-time investors may take it for granted how simplified the process has become.

"It's never been easier or cost less to gain access to the great capital markets of the world and benefit from long term capital growth that stocks have provided historically." Mr Skinner commented.

"30 years ago, if someone wanted to invest their money in the stock market, they would need to find themselves a stockbroker," Mr Skinner explains.

"That stockbroker would buy them about 30 stocks, at great expense, from the UK stock market.

READ MORE: Man sitting in a lounge chair with money plants © GETTY Man sitting in a lounge chair with money plants

"In return, the investor would receive reams and reams of paperwork by post.

"If they wanted to change their portfolio in any way, they would write back and weeks later, the trade would be confirmed."

This is a stark comparison to modern trading which can see stocks bought and sold in a matter of minutes.

However, this accessibility isn't even one of the biggest changes in investments recent history; the creation of funds opened investments to a whole new demographic.

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He added: "20 years ago, that same investor would have the option of now investing in a fund, managed by a professional firm, and that would give them access to hundreds of UK companies, at a fraction of the cost of a stockbroker.

"This might even include some overseas funds, such as US equities.

"10 years ago, that same investor could select from thousands of funds, allowing them to invest in any asset class, anywhere in the world.

"If their portfolio was sufficiently large enough, they could pay a professional to manage those funds, buying and selling them throughout the year."

a hand holding a cellphone: Man using cell phone © GETTY Man using cell phone

There is a sense of irony in this fact as what was once a necessity to invest in the stock market is now only available to those with large, valuable portfolios.

Mr Skinner continued: "Today in 2021, an investor can access over 20,000 companies spread across the globe, and benefit immediately from one of the best ways to target long-term growth - a low-cost, highly-diversified portfolio.

"This is often rolled up in one fund, with firms like Vanguard and BlackRock, doing all the hard work, investing in thousands of companies, for as little as 22p each year for every £100 invested."

Mr Skinner also spoke highly of apps like Moneybox, Plum and Nutmeg all of which automate passive investing to make investing easier for beginners or those wanting a streamlined process.

"For a few pounds, they can now get access to a low-cost index fund that's managed through their phone and provides them with daily updates.

"All of these apps are great for first time investors who don't have the time to research individual stock prices but still want to look for alternative ways to invest their money.

"For anyone that wishes to go into more detail and select which specific stocks they would like to invest in, there are apps that can be used as well, such as eToro, FreeTrade and Robinhood," he concluded.

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