By continuing to use this site, you agree to use of cookies. You can change this and find out more by following this link Accept cookies

DIY Investing: A Starter for 10...

PERSPECTIVES: Darius McDermott outlines 10 key points to consider when embarking on a DIY investing career

Chelsea Financial Services 24 December, 2012 | 6:00AM

This is part of Morningstar’s ‘Perspectives’ series, which features contributions from third parties such as asset manager, academics and investment professionals. In this article, Darius McDermott, managing director of Chelsea Financial Services, provides ten top tips for managing your own investments.

1. Know your personal risk tolerance – what percentage of your money are you prepared to suffer paper-based losses in the short-term? Can you stomach seeing your investment go up and down?

2. Decide on your short-term and long-term financial goals – what do you need the money for, how much do you need and when do you need it?

3. Work out how much you can afford to invest on a monthly or annual basis.

4. Research the different asset classes of investments (equities, bonds, property, cash and commodities are usually enough for most people) and understand the pros and cons of each.

5. Decide which combination of asset class will best help you achieve your goals.

6. Research the different ways of investing in these asset classes: funds, ETFs, shares, investment trusts, etc. And decide which one(s) you want to invest in.

7. Shop around to see where you can get the best deal for that investment and make sure you are not paying over the odds.

8. Make sure you are using your tax allowances: ISAs are a good starting place for your investments.

9. Regularly monitor and review your portfolio to make sure it is still on track to achieve your goals and adjust when necessary.

10. Ignore short-term noise and resist the urge to change your investment too often – you'll probably incur extra charges and we often make mistakes like crystallising losses because we panic, or buying a fashionable product just as it has reached its peak.

Morningstar Disclaimer
The views contained herein are those of the author(s) and not necessarily those of Morningstar. If you are interested in Morningstar featuring your content on our website, please email submissions to

Think you're an investing genius? Click here to prove it with Morningstar's Investing Mastermind Quiz.

  • Top 20 Dividend Paying Stocks Top 20 Dividend Paying Stocks

    UPDATED FEBRUARY 2014: A well-blended portfolio of stocks from the FTSE 350 can provide investors...

  • New Pensioner Savings Bond New Pensioner Savings Bond

    Next January National Savings & Investments will launch a range fixed-rate savings bonds for ...

  • Fund Basics Fund Basics

    A guide to fund investing for beginners...and those more experienced investors who need a re-cap

  • 3 Best Performing Europe Funds 3 Best Performing Europe Funds

    Developed market equities came back with a vengeance last year as the market momentum from 2012 c...

  • ISA Investment Ideas ISA Investment Ideas

    You have just over three weeks to shield this year's ISA allowance from the taxman. We asked a se...

About Author

Chelsea Financial Services  is a firm of independent financial advisers and the first intermediary to discount initial charges on unit trusts and bonds, and later PEPs and ISAs.