In today’s fast-paced financial landscape, young investors are increasingly presented with opportunities to invest and secure their financial future. However, many may be held back by the misconception that investing requires large sums of capital. In reality, this couldn’t be further from the truth. Thanks to innovations like fractional shares and thematic portfolios, the barriers to entry are lower than ever. These tools empower investors to begin building wealth with small, consistent contributions. Through strategies like dollar-cost averaging (DCA), even those with limited capital can embark on a steady path toward financial growth.
Table of contents
- Fractional Shares: Democratising Access to High-Value Stocks
- Thematic Portfolios: Investing with Purpose
- Customising Portfolios for Maximum Flexibility
- Small Change, Big Impact
- Take the Leap: Explore Fractional Shares Today
Fractional Shares: Democratising Access to High-Value Stocks
Fractional shares have transformed the investment world, allowing individuals to buy portions of high-priced stocks without the need to purchase an entire share. This means that with as little as S$100, young investors can now own pieces of top-tier companies like Google (GOOGL), Apple (AAPL), and Nike (NKE). Fractional shares are a game-changer, particularly for those just starting their investment journey, as they enable access to prestigious companies and diversified portfolios without the need for significant capital.
For instance, an investor can allocate S$100 across multiple shares, creating a “Magnificent Seven” portfolio of tech giants and consumer brands. This approach, combined with DCA, allows individuals to build wealth consistently over time by investing a fixed amount on a regular basis, no matter the stock price. With fractional shares, young investors are no longer excluded from owning powerful brands.
Thematic Portfolios: Investing with Purpose
Beyond fractional shares, thematic portfolios offer another innovative way to invest. These portfolios allow investors to focus on specific sectors or global trends that they believe in, such as Fintech, Clean Energy, Artificial Intelligence, or Blockchain. Thematic portfolios offer a sense of personalisation and purpose, as they align investment strategies with the investor’s values and long-term objectives.
Here are some key thematic investment areas young investors can explore:
- Fintech: The financial industry is undergoing a digital revolution, with fintech companies leading the change. These firms are creating faster, more efficient ways to handle everything from payments to lending, making fintech a strong thematic investment for those looking to tap into the future of finance.
- Clean Energy: With governments and corporations ramping up their commitments to sustainability, clean energy investments are seen as future-proof and vital for long-term environmental health. This theme includes companies involved in renewable energy sources, electric vehicles, and environmental conservation.
- Esports and Gaming: Growing industry of competitive video gaming and online entertainment, where players and teams compete in professional tournaments watched by millions worldwide ie. Leagues of Legends, The International (TI). With advancements in streaming platforms like Twitch and YouTube, esports has become a global phenomenon, blending professional sports with entertainment. This theme holds the continuous rise of esports viewership and gaming adoption across various demographics, driving significant revenue from sponsorships, advertisements, making it a key area of interest with strong potential for growth and investment appeal.
- Robotics and AI: Automation and artificial intelligence are reshaping industries, companies that lead in these technologies are poised for growth. Investing in this theme offers exposure to cutting-edge innovations that are transforming businesses across the globe.
- Clean Energy: With governments and corporations ramping up their commitments to sustainability, clean energy investments are seen as future-proof and vital for long-term environmental health. This theme includes companies involved in renewable energy sources, electric vehicles, and environmental conservation.
- Blockchain: Originally popularised by Bitcoin, blockchain technology offers more than just cryptocurrency. With its decentralised, secure nature, blockchain is being adopted across various industries, and investors can gain exposure by investing in companies focused on digital asset mining and transactions.
Customising Portfolios for Maximum Flexibility
The beauty of fractional shares and thematic portfolios is that they allow investors to tailor their strategies to fit their personal goals. Whether through geographic diversification via exchange-traded funds (ETFs) or a classic 60/40 portfolio (60% equities, 40% bonds), investors can craft a portfolio that suits their risk tolerance and investment horizon. For example, an investor might choose a 60/20/20 allocation, with 60% in equities, 20% in bonds, and 20% in commodities like gold, ensuring a balanced and diversified approach.
In addition, the upcoming Bundle Investing feature on the POEMS platform will further enhance portfolio customisation. Investors can allocate their funds across multiple stocks and ETFs using DCA, making it easier to manage a diversified portfolio. With as little as US$100, investors can spread their investment across a range of high-performing assets, ensuring growth while minimising risk.
Small Change, Big Impact
The combination of fractional shares, thematic portfolios, and DCA creates a powerful investment strategy for young investors. By making regular investments, individuals can develop healthy financial habits, learn about the markets, and prioritise long-term wealth-building over short-term consumption.
Parents can also use these tools to invest on behalf of their children, setting up diversified portfolios that grow over time. This not only secures their children’s financial future but also teaches them the value of smart investing from an early age.
Take the Leap: Explore Fractional Shares Today
Excited about the possibilities that fractional shares and thematic portfolios offer? You can start your investment journey right now with POEMS. With the flexibility to invest in fractional shares, you no longer need a large sum to own a piece of your favourite companies. Log in to POEMS to explore these innovative investment options, or reach out to our team for more details.
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