We live in a world where extremes make the most noise and get heard, but extremes are rarely the right place to be.
The world of investments is no different.
At one end we have the old world; the one that everyone knows and the one that anyone born before the new millennia, grew up with.
This is the investment world where you meet your wealth manager, you agree with everything they say, and you transfer over your savings to ‘grow’. Your Asset Allocation will look something like this:
this is a completely pointless thing for them to hold. You’d be better off just putting it in national savings. The return, if any, will be less than 0.5%.
These currently yield very little but are safe, so many investment portfolios, particularly pension funds, have to include them.
At this point, it’s worth bearing in mind that you are paying these people between 1% and 2% to place these investments for you.
The other things you hold in there will be the ones that are actually making you money. Corporate bonds, although by their very nature, the higher the yield, the less likely you are to get it back.
these are incredibly volatile and most people, including your investment manager, have absolutely no idea which way they’ll go.
The reason this works for them, remember, these people are paid via a management fee which is a percentage of your assets held with them. Therefore, the more money in the account the better.
Now onto the other extreme. The new world of people trading for themselves or going onto social trading platforms. There you will pay very little, but be promised a lot. Copytrade their current ‘trending’ trader, who may have no experience but got lucky last month and made 200%.
They won’t even charge you for this. It’s all free, you just have to open the account on their own brokerage site.
On many of these platforms, the average account size is less than £1,000 and 68% of accounts lose money. All the information you need to make the informed decision that this is a very bad idea, is right there in front of you. Yet one of the larger companies in this space have over 23,000,000 accounts held on their platform.
First of all, nothing is free. If it were free how would some of these companies have recorded turnover of over $600,000,000 in 2020? It isn’t free. They take money off you every single time you trade, you just don’t know it.
They are luring people in via adverts at football matches alongside the betting companies, as they are appealing to the exact same market audience as the likes of Bet365. They haven’t got their hands on Ray Winstone yet but surely, it’s only a matter of time.
They aren’t trying to hide it either. Their market audience, are the gamblers, the dreamers. Tell them there’s a chance they’ll make 200% in a month and they’ll give it a go. The sad truth is, it won’t work, and they will lose their money.
Any trader with decades of experience will tell you, if you’re making 200% a month, it’s not a system, it’s a coin toss.
They aren’t, because it isn’t real. They can’t promise these returns. Professional institutional traders are looking to beat the market by 3 or 4 times. If they do, they have a job for life. This is equal to about 20% a year ROI which any hedge fund would be happy with.
The problem is, their traders don’t always know what they’re doing as they aren’t heavily vetted like they are at somewhere like The Portfolio Platform.
If presented with stats such as last months performance, would you go for the steady trader who makes 4% a month, or do you choose the one who made 200%? Sadly, most investors would go for the 200%, as they don’t understand what they are looking at.
So, what is in the middle. It seems like a vast cavern of opportunity in-between: the old-fashioned portfolio, which has so many boxes to tick there is no possible way of actually making the investor any money; and the gambling broker platforms that the millennials are all signing up to without a thought or care.
Attitudes towards risk have changed, and the investment world needs to change with it. Sadly, opportunists are advertising to those who want fast returns, and it’s working.
This is where we prefer someone like The Portfolio Platform. They have found a huge gap in-between two markets that needed to be filled, and they’re filling it.
They have found professional traders, and have built their own platform for investors to use. TPP have personally vetted the traders to make sure they have the experience and the performance record to showcase their trading strategies.
They won’t accept traders who make 200% in a month, because it’s not a game and they don’t want the risks to outweigh the rewards. TPP want traders who will perform on a regular basis, beating the market, and helping investors increase their return on investment.
Their portfolios are here to replace the old world’s. They have no entrance fees, or exit fees, or management fees, they don’t even have any performance fees. We have also been informed that they will only work with tier 1 brokers who have the clients interests at heart.
The only fee TPP charge is a subscription. They have found this gives the best result for everyone. The traders are paid by subscription, and not a percentage of performance. This means they won’t take excessive risk, as there is no extra reward. If they perform solidly, as TPP ask, they will get more subscribers, and this will subsequently increase their monthly income.
Nearly all the biggest trade losses in history, were because the trader was on a performance-based bonus. Take that out of the equation, and it takes away one of the costliest emotions in trading: greed.
At The Portfolio Platform, it seems like they have built the answer to the future of investing.
In 2020, the average return from a Portfolio Platform strategy was 58.8%. Click here to have a look at what their investors are saying about them.
In closing- technology is changing the world, and very soon- the investment world might change as well. The Portfolio Platform could be ‘The Future of Investing’.
TPP can be found at www.theportfolioplatform.com