A few months ago, just as we were buckling in for lockdown I found out about an app called Trading 212. There’s both a desktop version and a mobile app which allows you to trade and invest in multiple ways, in a variety of assets and industries. The key selling point to me was that it allows you to buy and sell shares with no fees (except stamp duty reserve tax on UK shares, but that’s a UK thing and not the platforms fees).
I’ve always been intrigued about stocks and shares, but also worried about the risk and having to pay more than I get out of it. But this allows you that freedom to not pay additional fees but also let’s you start with as little as £1.
I signed up for the Invest account, but they also have a demo account where you can practice buying and selling shares, a CFD account (which is even higher risk), and an ISA account. I initially invested £25 at the end of April (literally the 30th!) and have invested another £25 in June, July and now August.
Disclaimers
First up, I just want to disclaim that I’m discussing my personal experience with this and I’m not a financial advisor. Before doing this, and even in the past 4 months I’ve taken time to read up about investing, stocks and shares, and even Trading 212 itself. However, trading will always have a risk attached and I can’t advise you as to what you should definitely do with your money. I’ve also budgeted my life pretty well to allow me to have the income to invest.
Another thing to note, I started during lockdown and during the escalation of the pandemic in the UK and the US. Most of the stocks I invested in are within these two countries, and the prices were much lower during the time due to economic uncertainty. This also meant that the money I invested was money that I probably would have been spending elsewhere if we allowed out the house.
Then lastly, I’ve also referral links to gain free shares throughout this time. This allowed me to gain approximately £30 worth of shares, without doing much at all. If you would like to start using Trading 212 and would like a free share (worth up to £100 potentially although mine were approx £10) you can use my referral link which allows both of us to recieve a share.
All you need to do is sign up to the Invest account and deposit £1, it usually takes about a day for the share to arrive in your account. The money made off the free share is freely available to withdraw into your bank account after 30 days, although all other shares you invest in with your own money can be sold and money withdrawn straight away.
What I Learnt Investing Small Amounts in 3 Months
Watching stock prices go up and down can be extremely stressful, but in general when buying shares you should be waiting it out. I’ve not withdrawn anything in the past 3 months, I’ve just been keeping an eye out on which of my stocks are doing well or not so well. The main focus is also to keep your overall “portfolio” in the green, which mine is.
None of my stocks are exceptionally different to when I first bought shares of them, right now whilst writing this I have 10 stocks and only 6 of them are in the green. But the 4 that are now less money are all around 50p less than what I bought them for, and I’m sure they’ll rise again in a few weeks.
Investing £25 doesn’t feel like a lot, and so it also doesn’t feel like a huge risk to your finances. Me not having that £25 hasn’t made my budget tighter, and so the minimal investment doesn’t hold the same fear that investing thousands would. £25 also adds up if I’m putting that away every month. By the end of 12 months you could have £300 worth of shares which could potentially be gaining you money. If you’re looking at investing as long-term, as you should be doing, the small amount of money does grow over time even if the shares don’t increase that much.
Of course, there is always the risk of a stock plummeting, but having a diverse portfolio helps negate that risk too. When I first started, I was looking through and chose companies I knew about (like Disney, Netflix and Twitter) and to be honest, they were fairly expensive although I always chose ones which had a red graph when you looked at the history.
The UI on Trading 212 is so easy read, as you can see if the stock has been going up or down in the past day, week, month, 3 months, year and all time to inform you. However, as my portfolio has grown and I’ve read up about risk management I’ve now got multiple industry stocks which level each other out quite a bit when some aren’t doing as well.
Trading 212 gives you notifications if certain industries or stocks have something going on. It’s important to keep your eye on potential stocks which you want to buy into, and to buy at the right time. For example, this month I spent my £25 on Barclays and Lloyds Bank because the banking industry had a hit, and the shares were cheaper. I’ve already made £1.94 as of writing this on these two stocks because they quickly recovered.
What Is The Outcome of Investing Small Amounts in 3 Months
I’ve already mentioned this, but I’ve gained approximately £30 more in my investment portfolio from the free shares I recieved. Both the stocks I got were energy companies, which aren’t doing badly so I’ve decided to hold onto them for now. However, if I wanted to I could sell the shares to reinvest the money in stocks I’ve chosen myself which may be more beneficial if you’re more experienced. Or I could now withdraw the money into my bank account if I wanted to!
On top of free shares and the money you’d make after selling shares that have gone up, you also recieve dividends. Now, with the amount of money I’m investing the dividends are not huge. I’ve made a whole 31p since April on Trading 212 which is not a lot. But it is 31p more than what I had three months ago, and it’s probly 31p more than what I’d have if that £100 was sat in my bank account. It’s also technically a 0.31% increase in my money in three months which is better than most banks at the moment. Dividends can be withdrawn immediately or re-invested and I chose to re-invest as it was so little but it can add up.
Investing Little and Often
If you’ve not already got a massive amount of money, investing may seem like a ridiculous choice that’s super high risk. But historically stock prices increase at a higher percentage than the interest banks provide… meaning you could grow your money that would otherwise be sat in your savings account doing nothing. Obviously it is a risk and you may lose money, however investing money you wouldn’t miss helps it not burden your financial situation and if you’re not dependent on that money it helps reduce long-term risk. Investing in multiple different companies helps spread risk as well as different regions and industries.
If you’re interested, I would recommend Trading 212 as an app. Plus, you can gain a free share worth up to £100 by using my referral link. All you need to do is sign up to the Invest account and deposit £1, it usually takes about a day for the share to arrive in your account.
I’ll be continuing to invest little and often as it’s a good way to diversify how I’m saving my money, but my ISA and savings accounts are still being used too. If you found this post interesting, I can create more as I spend more time on the platform or have any questions please let me know in the comments below!
