Opening an account
Maintaining your account
If you opted for a managed account
If you decided to go for an investment account with Nutmeg, Moneybox or Vanguard, you really won’t have much to do in order to maintain your account. Just make sure that you are happy with any changes to fees, policies and that you know how your money is being invested.
If you picked your own stocks/ ETFs
You will have hopefully done a lot of research on the stocks that you are holding and know the components of any ETFs, so you will know what you own.
What will be important here, is that you keep up-to-date with news on the companies and sectors. This will ensure that you are aware of anything that might make you want to sell your holdings or even buy more.
I would recommend checking in on a weekly or monthly basis to see if there is any news that you should be aware of. If you need to adjust your portfolio, this is completely normal but just make sure you don’t look back in the future and feel bad that you sold too early.
For this reason, if you have a highly diverse portfolio it can be a double-edged sword as you may need to spend longer looking into news articles and doing your due diligence (research) or you may not care because the positions are all of a relatively small size so don't need to regularly check in.
Selling positions
If you have shares in a company and you are already up X% and aren’t sure whether you should sell the position or not. A quote which I always try to remember is:
“Nobody ever went broke taking a profit”
Therefore, if you want to be a profitable investor, you will need to take profits from time to time, however if you believe in the company long-term you should probably hold unless anything drastic has changed in the last month.
With short-term stocks, you can get too greedy and see high profits turn to losses which will never recover. Unfortunately, I know this first-hand and suggest you always take a profit when you can.
A method I like to use for short-term positions is the following example:
Say you invested £100 in ABC Plc
The stock price has rocketed and the position is rising up towards £150
I would sell the initial £100 and leave £50 in the company to '“ride the wave”
This means whatever happens, you haven’t made a loss because you cannot lose more money in a company than you put in there.
So if the stock price suddenly fell to rock bottom and they are worthless, the £50 you left in there would now be worth £0 - but you wouldn’t owe the company money.