Discover How Investors Grow Their Portfolios on Autopilot

Discover How Investors Grow Their Portfolios on AutopilDiscover How Investors Grow Their Portfolios on Autopilot ot

When people read stories about investors who have made a lot of money in the stock market, forex, or other financial markets, they assume these individuals put a lot of thought or time into their investments.

There may be circumstances where people are trading forex as a day job, making a lot of money, and putting significant time and resources into the endeavor. The vast majority of investors, however, do not actively manage their portfolios.

Put yourself in the position of a person who is working a regular job and wants to save for retirement. Think about the individual who is running a business and wants to leverage the stock market or crypto but has his hands full with his company. How do these people manage to invest in the markets and come out ahead?

Most people have their investments on autopilot, which allows them to make a few decisions every couple of months, ride out the peaks and troughs of the market, and emerge with significant profits in the long term.

Below is our guide to passive or low-effort investing and running your portfolio on autopilot.

Avoid Hand Picking Stocks

One of the most common mistakes that new investors make is to make a hand-picked list of stocks they want to add to their portfolio. Such an idea is well-intentioned, as everyone thinks they are the person who has the best idea about where to invest and not invest their money.

The problem with such an idea is that unless you are thinking of investing as a part or full-time job, you will never have the time to keep up with market trends and economic events. Perhaps the stocks you pick at present are intelligent options, but how will you know when to sell them or add new investments to your portfolio?

The positive news is that you can go with another option instead.


Invest in Market Tracking Funds

The best friend of someone who wants to invest on autopilot is to put their money in index funds. Think of an index fund as a place where you are putting your money with the fund and then using that money to buy various stocks on the market.

There are countless options for index funds, depending on the level of risk you want to take and for how long you hope to keep your money in the market. If you are truly thinking of investing as a passive stream of income that is on autopilot, then you should pick an index fund that tracks the market.

Studies show that people who put their money in S&P 500 tracking index funds have come out ahead in the past three or four decades, regardless of how the economy fluctuated in the short and medium term. If you are planning to invest for another 20 to 30 years, then such a fund may be for you.

Decide on How Much To Set Aside Each Month

Adding money in lump sums to your investment accounts is not the best idea. You may think that you will keep up with such a project, but there will be times when you forget to make your quarterly addition to the fund. There is also the temptation in these situations to use the money you earned through a bonus or tax refund for various purchases rather than investments

If you want to invest passively and on autopilot, decide on a fixed sum you can afford to put aside each month from your present job. Set up an auto fund on the site where you are investing, which ensures a specific sum is added to your account every 30 days.

Now you do not even have to think about when or how much money is going into the account. The only times you can make adjustments are when you get a pay rise or if you change jobs.

Consider Forex

People who dedicate hours of their day to trading forex are doing so because that is their day job. They leverage the hourly fluctuations in forex prices to buy and sell, ensuring they make a profit on most trades. Since you are hoping to invest on autopilot, such a plan is not ideal for you.

That does not mean you should stay away from the forex market, as it does offer many enticing opportunities. There are forex robots or EAs that you can use to get you the profits you are seeking from the forex market. 

Forex robots are attractive as they usually come with lower fees, with a computer algorithm buying and selling currencies on behalf of your account. You can even set the level of risks you want the algorithm to take with its investing.

Going for an EA, or expert advisor, will incur more fees as there is a real person managing your money. If you are extremely conscious about your portfolio, then such an option may be appealing.