Choosing an investment strategy is a difficult venture, and that’s because it’s not a clear cut decision on which strategy to commit to. Every strategy has pros and cons, and in different areas, different strategies are better for you… which is why it’s difficult to select anything from the wide array of strategies around. But imagine you had a quick and easy way of finding out which strategy best suited you?
Our investment strategy comparison infographic does this for you. We’ve simplified the complexities of the top three investment strategies, and produced a useful infographic for doing just this. We’ve analysed how STRIDE, fund managers and index funds stand against each other in different aspects: method, time/effort, return, cost, risk and diversification. This information then allowed us to create an easy-to-understand infographic, which helps you to quickly understand the top investment strategies and choose the one that is best for you.
In this third part to our investment strategy series, we’ve decided to better explore the role investors have in different strategies. Sometimes it’s important to know how much time and effort is required before committing to a particular strategy, which is why we’ve gone ahead and researched this for you.
What’s Your Role in Investing Strategies?
1. Fund Managers
Investing with a fund manager requires a consistent time commitment, due to monthly, or sometimes even weekly, meetings with them to discuss your investments. But, the amount of time and effort spent is not outrageous.
Many enjoy the idea of spending less time and effort in their investments, but there is the other side to this coin… and that’s control. By investing with a fund manager, you’re relinquishing the majority of your control over your investments. That’s because you’re limiting the time and effort spent on researching what’s best for your investment, and rather giving this responsibility over to your fund manager, who you ultimately need to trust to make the right decision.
2. Index Funds
Index funds are the safest option of investing, because they offer the lowest risk. Investing in index funds requires very little time and effort, as once you have made your investment decision, it’s a long-term investment game.
The time and effort mainly comes into play when researching which index you want to put your money into, but once you have made that choice there is no required time to put into managing your investment. You should check in consistently, particularly when looking to sell or in volatile market conditions, but your investment requires little effort to analyse.
The good news here is that you’re in control of your investment decisions, because you alone decide when to hold, sell or buy. You can’t control the fluctuations of the market, but you can choose how to react to them.
STRIDE is an outlier amongst these three strategies, because while it requires a continuous time commitment, with weekly check-ins, it also offers full control over your investment, low effort and better returns.
STRIDE sends you weekly notifications and advice on the stocks that you hold, which is why the continuous time commitment is necessary, but analysing these notifications is effortless. STRIDE simply encourages you to buy, hold or sell, and then leaves the decision up to you. Minimal effort, but full control.
While STRIDE is perhaps the most time intensive of the three strategies, it closely matches index funds in the amount of effort required, but far outweighs both other strategies in return size. Interestingly enough, our findings place fund managers at the bottom of the pack, performing well below even index funds.
So learn which investment strategy is right for you by downloading our comparison infographic below.