In recent years, advances in financial technology have democratised investing. As a result, you can start investing today with only a little amount of money. Looking to begin your investment journey with a small outlay? Here are five top stocks to consider.
Alphabet
If you’re looking to invest in a solid, well-established company – which could be a good move as a beginner – you may want to take a look at Alphabet (NASDAQ:GOOG). It’s the owner of Google and YouTube. It also has a cloud computing business.
Alphabet has been a great investment over the long term. And looking ahead, it should continue to deliver for investors. This is a company that is well placed to benefit as the world becomes more digital. And right now, its valuation is very reasonable.
Currently, Alphabet shares trade for around $170. This means that for a little over $500 (approx. £400), you could get three shares in the technology giant.
Uber Technologies
Looking for something a little racier? Well, you may want to consider Uber Technologies (NYSE:UBER). It’s the largest rideshare company in the world.
Uber is growing at a rapid rate today. Thanks to high demand for its offerings, revenue rose 17% last year. Profits are on the up too. This year, Wall Street expects Uber’s earnings per share to rise about 50%. The downside to this stock is that it can be volatile. Often, its share price moves 5% or more in a day.
Taking a long-term view though, it has a lot of potential.
It currently trades for around $70 (approx. £56), meaning that a $500 investment would get you seven shares in the company.
HSBC Holdings
If dividend income is your goal, check out HSBC Holdings (LON:HSBA). It’s one of the largest banks in the world.
This stock offers a very high dividend yield at present. Last year, HSBC paid out 61 cents per share to its investors. At today’s share price, that translates to a yield of nearly 7%. For long-term investors, there could be share price gains on the cards too. Right now, the stock is trading at a low valuation.
Currently, HSBC’s share price is around £7. This means that a £500 investment would get you roughly 70 shares in the bank.
Unilever
If you’re a low-risk investor seeking stability, shares in Unilever (LON:ULVR) could be a good option. It’s a consumer goods company that owns a lot of well-known brands.
The beauty of Unilever is that consumers tend to buy its products no matter what’s happening in the economy. So, it’s a sleep-well-at-night stock. It also sports an attractive dividend. Currently, the yield is around 3.6%.
At present, this stock is trading for around £42. This means that for a little over £500, you could get 12 shares in the company.
Rightmove
Finally, if you’re looking to invest in a smaller company, Rightmove (LON:RMV) could be worth considering. It operates the UK’s largest property search portal.
From an investment perspective, this company has a lot going for it. Not only does it have a very strong brand and market position, but it also has a very high level of profitability.
It currently trades for around £5.40 meaning a £500 investment would get you about 90 shares.
Managing risk as a beginner investor
It’s worth pointing out that managing risk can be challenging as a beginner investor. Every company has its own risks and share prices can fluctuate a lot.
To reduce stock-specific risk, experts often advise owning at least 20 stocks. But if you only have a small amount of money to invest, this may not be possible.
One way to get around this, however, is to invest in mutual funds or exchange-traded funds (ETFs). These products allow you to invest in many different companies with a small amount of money.
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Edward Sheldon owns shares in Alphabet, Uber, Rightmove, and Unilever.
Based in London, Edward is a distinguished investment writer with an extensive client portfolio comprising a diverse array of prominent financial services firms across the globe. With over 15 years of hands-on experience in private wealth management and institutional asset management, both in the UK and Australia, he possesses a profound understanding of the finance industry.
Before establishing himself as a writer, Edward earned a Commerce degree from the prestigious University of Melbourne. Complementing his academic background, he holds the esteemed Investment Management Certificate (IMC) and is a proud holder of the Chartered Financial Analyst (CFA) qualification.
Widely recognized as a sought-after investment expert, Edward’s insightful perspectives and analyses have been featured on sites such as BlackRock, Credit Suisse, WisdomTree, Motley Fool, eToro, and CMC Markets, among others.
You can contact Ed at edward@goodmoneyguide.com
