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.
