As England makes it through to the quarter finals of the World Cup group, our Platform Manager Ant Beddows takes a look at some of the surprising parallels between investing in property and the beautiful game.
The World Cup is proving to be a refreshing revival of all that football should be: A fair competition between respected parties, bringing millions together through common interests, conversation and enjoyment – a few of things that here at Propio, we believe investing should be too. So, in the spirit of the tournament, we thought it would be good to explore the similarities between investing and football a little further and how you can employ some of the oldest tactics in the book to your investment portfolio.
1. Start young
Just like all the best footballers make their professional debuts in their teens, it also pays to start investing those pennies from an early age. Investing is no longer only accessible to those with experience and deep pockets. My parents always taught me “Look after the pennies and the pounds will look after themselves”. In fact, our recent article on compound interest explores the amount that you can rack up over 40 years from a single investment of just £1,000. The lesson is, start early and you’ll, in theory, have much more financial freedom in later life.
2. Practice makes perfect
It is no coincidence that Ronaldo has remained the best player in the world for such a long time or that Henderson made it pro in the first place – both of their successes are closely tied to the sheer amount of practice and dedication they put in. In the same way, the more that you learn about investing and markets, the more successful you are likely to be. Whether it’s stock markets, the property market or what ISAs options provide the best returns, a bit of careful research could soon find you at the pinnacle of the investment game. Even if you’re only investing small amounts at the beginning; time and practice are the keys to success.
3. You need a balanced squad
As ever, to win a world cup you need a balance of flair, determination, reliability, strength and experience. You’re not going to take home any trophies if you’re just relying on your star player. The same is true of your investment portfolio – the more diversity you have within your portfolio the better. That could mean adding property to your portfolio in the first place, diversifying across equity and debt and even spreading your risk geographically to provide the best sustainable results.
4. Superior tactics
We all watched in awe as Mexico defeated the not-so-mighty Germans in the group stages. One lesson that we can learn from the rise of the underdog is to have a plan and stick to it, come rain or shine. The same principle can be applied to investing. You need to think about your long term goals whether that be retirement, putting your children through university or buying your first home. Having a plan that you can stick to over a long period of times means that you can reap the benefits of investing in illiquid assets that require longer hold periods. Equally, having a robust investment strategy such as “little and often” will have similarly strong long term results.
5. It always helps to have a couple of stars
Whether that be Kane, Messi or a residential equity investment in a booming region, whilst it may require a bit more research and sometimes a leap of faith, this strategy can be well worth the effort and provide results beyond even my wild imagination.
Just like football, when it comes to investing, there are lots of great options out there to support and now with alternative investment platforms like Propio, property investing is something that almost everyone can take part in. But remember, as with football, it is competitive and nothing is certain until the final whistle.