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Do you not endorse providers of a smaller size? Is there a reason for this?

18 March 2022

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Question by Priya

Hello, love your site. I just wanted to ask a quick question. Your recommendations (ETFs) seem to be the big companies but on Reddit they talk a lot about smaller companies like Invest engine etc. do you not endorse providers of a smaller size? Is there a reason for this?

Answered by Oliver McDonald

Hello Priya,

Many thanks for your question.

Although I cannot provide specific advice here, you may find the details below useful.

Investing in a well-diversified global fund is normally a good place to start. These funds often consist of large companies that have a proven track record - when your funds are invested in hundreds, or thousands of companies around the world, this gives you a good chance of achieving a steady return over the long term.

Smaller companies certainly have the potential to grow much faster, but there is normally more risk involved.

You should weigh up what your investment goals are, along with how much risk you are prepared to take. Do remember, that Reddit users can be anyone - they are not regulated advisers so please do your own research before acting on the advice. Or seek professional financial advice.

Having a sit down and think about what your long-term investment goal is, should be the first point of call. Are you saving for retirement, a rainy day, or a specific goal like buying a house/car. Generally, investments should be held for 5 years+ to provide the best chance of achieving positive growth.

Picking stocks and shares individually is a tough game. Many professional fund managers struggle to achieve long-term results. Investing in well-diversified funds, over the long term will give you a good chance of achieving positive growth. As mentioned, these funds will often consist of the best companies on the planet, run by some of the smartest people on the planet.

There are smaller company funds available on the market - you could research these. However, as mentioned, picking stocks and specific funds in niche areas is a tough game to get correct. Thinking about your goals/objectives and relating your investments to these is incredibly important.

I hope that helps for now.

Oliver McDonald

Answered by

Oliver McDonald

Director & Independent Financial Adviser

I have worked in financial services for 15 years gaining extensive experience in financial planning. I am a people person. You will rarely find me explaining complex spreadsheets or using jargon. I keep my conversations at a high level and realised early on that financial planning is all about helping my clients achieve the lifestyle they want in future. I work with individuals, business owners and entrepreneurs. I specialise in retirement planning, investments and business protection.