A selection of frequently asked investing questions.
When you gamble, you own nothing and the odds are stacked against you. An investment in the stock market means that you own a share of a real company. Both investing and gambling involve risk, but a diversified investment portfolio over the long term manages that risk.
The consensus among experts is to keep investments in the stock market for a minimum of 3-5 years. It’s totally down to your own personal requirements, but the longer you stay invested the more you can take advantage of the magic of compound interest.
Keeping track of your investments is important, but try not to constantly check your balance. Once your portfolio has been constructed, taking a look each month when adding to your positions is about right. Others do so every 3-6 months in order to rebalance their portfolio.
Stocks and shares are the same thing: a security that represents part-ownership of a company. The use of ‘shares’ as the preferred term is more prevalent in the UK.