How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.
Robert G. Allen, Investment advisor and author of several bestselling finance books.
To actually invest you need the respective platforms, e.g. online brokers. This section will guide you through the criteria that you should consider when choosing your platform(s)
Overview: 3.2. Implementation
1. You need a platform to purchase your instruments
I love quotes…but in the end, knowledge has to be converted to action or it’s worthless.
Tony Robbins, American author, entrepreneur, philanthropist and life coach
To implement your strategy you must somehow buy and sell assets. Depending on your strategy you might need more than one platform. A platform is used to view and administer your investments. There are many platforms out there for different kinds of assets, the main ones are:
- Bank Accounts, either offline or online
- Online Brokers, to trade stocks, ETFs, bonds, futures and FOREX, bonds (Link to Guide)
- TreasuryDirect, where you can buy US bonds directly from the government with no fee!
- Financial derivatives dealers, mainly for CFDs
- Crowdfunding platforms
- Cryptocurrency trading platforms
- Whatever else platform that you need for alternative investments
2. Don't take any platform, choose wisely with a set of criteria
Any item in your wardrobe should satisfy one of two criteria: utility and joy.
Stacy London, American stylist, author, and magazine editor, co-host on “What Not to Wear”, fashion editor at Vogue
For sure there are different important criteria that you have to take into consideration when choosing the platform that you want to invest through. Below you can find the main criteria:
- Costs should be as low as possible, as every transaction will have some cost associated. Keeping costs low accounts also for the instruments that you choose (e.g. not managed funds, ETFs, …) as well as for the platform that you chose.
- Trustworthiness & Reliability is very important as the future of your finances (at least partly) depends on the platform. You will want to have a platform that has a solid background and is based in your country to have access to legal manners in case of any problems
- Usability is important as you have to deal with the platform on a regular basis. You want it to be easy to handle and fun to work with. Also, you want it to be failproof, to stop you from making major mistakes cause by an unclear user interface.
- Customer Service should be available in your language to deal with eventual problems coming up
- Investment options vary from platform to platform, you might have to register for more than one platform to invest as you planned in your strategy. But you also might be lucky and find all instruments on one platform!
- Guides and training courses will show you in the beginning how to use the platform and have an easy entry
- The tools and information and their respective quality influence you in the analysis and evaluation of your portfolio
- Apps will help you to keep an eye on your investments and make it fun to you to manage them.
We will provide you with guidelines and overviews on the best platform for you, based on your specific investment canvas! Just continue from here and start your investment canvas.
3. Choose the platform or several platforms that are the best for your requirements
The two most important requirements for major success are: first, being in the right place at the right time, and second, doing something about it.
Ray Kroc, American businessman, joined McDonald's in 1954, Kroc would present himself as the founder of McDonald's, was included in Time 100: The Most Important People of the Century
There is no general rule for the pricing of the platforms. Prices vary by instrument and platform. However, all platforms charge for buying and selling. Keep in mind that also the prices of the instruments are relevant, e.g. there are funds with annual fees. Even if a platform offers you to buy and sell for free there will be other administration fees somewhere, e.g. you have to pay an annual fee. Best is to make up your specific case, depending on if you trade only rarely or more regularly.
In your personal Investment Canvas, we will present you with suitable platforms that best fit your demand.
You need a platform to purchase your investments. For the different asset classes there might be different platforms that you should choose wisely. Trust and costs are the most important factors, but also other aspects like usability, customer service, investment options, guides and training as well as the tolls, information and apps and their respective quality should be considered. Take the quiz below and continue reading our next article!
Test yourself and finish this step of the Investment Academy!