It seems like Do-It-Yourself (DIY) anything is growing in popularity. From crafts to home renovations, it looks like DIY is the way of the future in many aspects of life. But what about investing?
Any form of investing involves a portfolio of investments. A more diversified portfolio safe-guards the investor from losing an investment that is too heavy in one aspect. In DIY investing, the investor is in complete control of the portfolio’s investments. Instead of trusting an investment manager or full-service brokerage, an investor manages their own finances. They end up with more control and fewer management fees.
This type of investing offers DIY investors more control and flexibility when buying and selling. Rather than having to contact a controller or brokerage, it’s all up to them. Some find there can be more freedom to invest in alternative investments when managing the investment portfolio themselves. By the same token, portfolio diversification becomes the investor’s responsibility, too. There’s no management company looking after your accounts to make sure you’re well diversified.
Due to this lack of help from an experienced investment firm or brokerage, DIY investing can seem frightening. However, thanks to the internet, it’s becoming much easier for investors to go it alone.
Many online tools and software make it easier for an individual to manage a more complex portfolio. As a result, they’re able to diversify their portfolio across a few alternative investments. Automated- or algorithm-based investment services are another digital tool users can turn to. These provide users with data and knowledge they didn’t have access to before.
The past market crash saw many people losing much of their investment dollars. Now, many have taken on the task of managing their own investments. But it wasn’t the crash alone that’s fuelled DIY investing. Others have received poor recommendations from advisors that have left a sour taste in their mouth. These negative experiences can push people into the DIY investing sphere. And with all the latest online tools, it’s easier than ever.
The thing to remember when considering managing your own investment strategy is that it’s going to take time. Time monitoring your investments, educating yourself on market changes, best practices, and your own comfort levels. There’s a lot you’ll need to keep up to date with, too. Market news, trends and shifts, projections, and best practices in investing. Our best advice for you out of the gate? Make sure you actually have the time. You need to put the time in, to focus on the details and understand your risk tolerance.
The more you understand about investing and the importance of portfolio diversification, the better. You’ll need to make educated decisions, not emotional ones.
The most difficult part for DIY investors can be figuring out how to diversify their portfolio. Investing in alternative investments, such as Mortgage Pools, is a great place to start. Look at Mortgage Investment Corporations (MICs) who manage Mortgage Pools. They allow you to retain control of your investment more closely while giving some of the technical work to the MIC and the experts who manage the pool. Managing your entire investment portfolio can be daunting and time-consuming.
Using the experience of an MIC and investing a part of your portfolio in mortgage investments is a great way to free up some of your time. You can use that time to handle the other aspects of your portfolio. This method still provides you with far more control over your investments than any conventional brokerage approach. Ultimately, DIY investing can help you find balance. As time-consuming as it is, no one wants portfolio management to take control of their life.
If you’re interested in diversifying your portfolio and investing in a Mortgage Pool, we’d love to hear from you. DIY investing doesn’t need to be something you do entirely on your own. You can capitalize on all the benefits of DIY investing while still capitalizing on help from an experienced team — like us. Get in touch with Jordan on our team today.
19 Sep, 2024
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Since 1994, Cooper Pacific Mortgage Investment Corporation has been helping communities and investors across Western Canada grow and prosper. As real estate experts, our goal is to offer investors outstanding mortgage investment opportunities with an attractive rate of return. We do this by offering short-term construction financing and interim mortgage funding to help builders and developers take projects from planning to completion.
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