I want to invest money but I have no idea how or in what? (mutual fund, trading)
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If you want to maximize your gains and are willing to take risk then leveraged ETFs are a good option, especially the ones I mentioned. It's much better than putting your money in penny stocks or all in biotech stocks waiting for FDA approvals.
However, they are not something you buy and check one year later and definitely not 10 years later. They are leveraged! You should be watching the technicals very closely. If the stock market crashes 50% those leveraged market ETFs will be almost worthless. Technically they could go back up with the market but then you risk the manager pulling the plug on it if it is no longer profitable.
However, they are not something you buy and check one year later and definitely not 10 years later. They are leveraged!
its unfortunate that you cant just expect 3 times your long term expectation of the underlying index. so if I expect a 10% annualized return over a 10 year period, the triple nasdaq gives me a 30% annual yield.
The problem with leveraged ETFs over the long term is that, even if the market has been FLAT or UP a bit, your leveraged ETF can be DOWN (sometimes way down) due to the volatility/price decay issue I'm talking about. And the longer the time frame, the more likely this is to be the case.
OK, you're 25. You have 40 years by which to build a very comfortable retirement. If you truly want your money to "multiply", I would strongly suggest setting up a Dividend Reinvestment Plan using solid blue chip stocks from the top 10 best performing mutual funds. Make sure you diversify your investments, and take your age and invest that percentage of your portfolio into fixed income (you can also invest up to 10% of this portion in gold and other precious metals).
In Canada, a $20,000 portfolio may look something like this (each stock is a block of 100 shares):
Equities:
Crescent Point Energy
$38.87/shr - 7.1% yld
BCE INC
47.82 shr - 5.17% yld
Power Financial Corp
$34.77/shr - 4.03% yld
Transcanada Pipeline
$48.90/shr - 3.92% yld
Eldorado Gold
$7.96/shr - 0.25% yld
$2195 in GICs, Bonds and/or high-interest savings.
This would give you four high-yield stocks that are diversified into energy, communications, finance and resource services, some exposure to gold as a buffer and a guaranteed income from your fixed-income segment. Going forward, I would add other high-dividend equities. You can look at the top 10 holding from the top 10 performing mutual funds for ideas on which would make the best choices.
Don't worry about trying to make a fast return. This approach will maximize your returns over time with minimal risk to your investment. It may not be the sexiest way to make money, but it is extremely effective.
I have a masters in finance and passed the 1st 2 levels for the CFA and most of the real world knowledge I use in investing my own money came from blogs, a few books, and forums (including this one).. finance theory helps but none of the advanced stuff matters unless you manage a $1 billion portfolio.
That kind of figures. College classes are mostly just a lot of "academic theory" anyway.
It's only after I graduated from college that I actually learned how things work in real life. lol. So it is with money and investing.
So I'm 25, I've got a bit of money saved up and I want to multiply it as much as I can. I'm currently in the home stretch of my PhD and by the time I graduate later this year I should have £11,000 - £13,000 in the bank. I want to put it to work and I don't mind if a little bit of risk is involved if there's a decent chance of a big payoff.
However, I know precisely jack **** about what to invest this money or how to go about it. I don't know the first thing about investing and I am not about to blindly hand my savings over and have faith in something I don't understand.
So if anyone has any advice for me I'd like to hear it, anything at all.
Real estate aka "rental" isn't so bad.. if done smartly.. you will ALWAYS own it in the worst of times if you don't do mortgages..
Also look into bit coin, miners.. they manufacture money of a sorts
I don't know much about stocks and bonds.. but I do know there is severe problem going on of our debt to china (US) and the eu union has tons of debt too.. (and as you may have noticed? Japans debt problem is becoming public awareness) so it's not good and err I think it's a risky market.. but take your chances and see
The problem with leveraged ETFs over the long term is that, even if the market has been FLAT or UP a bit, your leveraged ETF can be DOWN (sometimes way down) due to the volatility/price decay issue I'm talking about. And the longer the time frame, the more likely this is to be the case.
I should have said, "even if the UNDERLYING INDEX is flat or up," the leveraged ETF that's tracking it can be down.
Below is an example of the Russell 2000 small cap index vs. TNA, the Direxion 3x Smallcap ETF. In this particular stretch of time (less than 2 years), the index is up about 10%. You might expect the triple ETF to be up about 3x the index or 30%, right? But it's actually DOWN 35%. That's because of price decay caused by the combination of 1) the DAILY resetting of leverage, 2) compounding, and 3) the up and down action of the market during this time. And as I mentioned before, the longer the time frame, the more likely it is that similar volatility is going to deteriorate returns.
However, if you look at the trend beginning early 2009 and lasting through mid-2010, the triple ETF actually returned greater than 3x the index during that stretch. So the chart nicely illustrates both the good and the bad with these leveraged ETFs.
Having said all of that, I agree with Celcius who said that leveraged ETFs don't even belong in this conversation. I'm just trying to explain why they don't.
All you really need to do to get started is to google "dollar cost average into an index fund" and read up.
Seen some people say lately that DCA isn't worth it. Couple articles came out disproving it - I think one from Vanguard. Interested to hear what's most credible.
So I'm 25, I've got a bit of money saved up and I want to multiply it as much as I can. I'm currently in the home stretch of my PhD and by the time I graduate later this year I should have £11,000 - £13,000 in the bank. I want to put it to work and I don't mind if a little bit of risk is involved if there's a decent chance of a big payoff.
However, I know precisely jack **** about what to invest this money or how to go about it. I don't know the first thing about investing and I am not about to blindly hand my savings over and have faith in something I don't understand.
So if anyone has any advice for me I'd like to hear it, anything at all.
take it from someone who made nice money on a certain few individual stocks but who also lost on a few duff picks
most people ( myself included ) are better simply buying the " market " , you can buy the S+P etf for a fee of 0.05% commission with vanguard , you may not double your money in one year but over a long period , it is impossible to loose , im talking life long , you can pick up a modest dividend along the way
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if you don't do mortgages..
but I do know there is severe problem going on of our debt to china (US) and the eu union has tons of debt too.. (and as you may have noticed? Japans debt problem is becoming public awareness) so it's not good and err I think it's a risky market.. but take your chances and see 
