Building an investment portfolio can be a tricky business when you’re new to the scene. The best advice may be that you should begin with the areas you know well, or quite well, so that you can make informed choices and consequently create a robust portfolio. In fact, selecting and targeting a specific market sector is probably the best way to begin your journey in terms of looking for investments and stocks – otherwise the whole experience can be both overwhelming and intimidating.
Finding relevant information
Evidently, you should check out the prospects of your potential investment opportunities including examining and evaluating them at what might be called ‘surgical’ level. Most serious investors read Benjamin Graham – he was a mentor to Warren Buffet and penned the book The Intelligent Investor in 1949, which has become a seminal work for many students of economic development and value investing – and for good reason.
You should also seek out sound sources of advice. Pete Briger is a principal and Co-chairman of the board of directors of Fortress, an investment banking organization. Briger’s personal success includes being awarded responsibility for the Credit and Real Estate business at Fortress. He is also a member of the board of Tipping Point, which is a non-profit organization that serves low-income families in San Francisco. You can find out more about him by checking out Peter Briger on CNBC.
Which market sectors?
Market sectors go in and out of fashion and it pays to keep an eye on what is performing well, and what isn’t. For example, information technology stocks are very nicely positioned within the most popular sectors in terms of investment potential and healthcare stocks are proving to be particularly resilient in 2015. Likewise, interest in organic and natural foods has also increased over the years and appears to be set to continue for some time to come.
There is always a risk when it comes to investing however; witness the slump in oil prices, for example, which has resulted in lower energy costs. Of course, this also means that customer discretionary income has increased – the funds that consumers can spend on items they may have wanted for some time but have delayed purchasing due to the general cost of living. In light of this, luxury goods may be a good target for investment funding.
Transportation may also be worthy of consideration as reduced fuel costs have an impact on everything including airlines such as Southwest, the world’s largest low-cost carrier that is currently expanding the number of domestic and international non-stop destinations it offers.
If you’re keen on ethical investments, remember that day-to-day living requires groceries and companies such as Kroger are providing just that, and winning awards in the process. In 2014, it was the Gold Winner of the Best Employers for Healthy Lifestyles award – given because of the company’s workplace well-being programs for associates and their families. In addition, the company has consistently donated millions of meals to food banks.
Finally, remember that if you are new to investing, it will pay to take the time to discuss your investment preferences with an experienced specialist.