37M, UK based but trading US equities.
For the last 2 months I have been auto investing 500/month into VWRP via ISA and 500/month into a Vanguard pension. That part is locked in and not changing. This post is not about that.
I want to allocate an additional 200/month into individual stocks for asymmetric upside over ~5 years. Not looking for 0DTE or meme lotto tickets, but also not looking for index hugging returns.
Goal is to concentrate capital into a small number of quality names where the upside comes from earnings growth or structural tailwinds, not pure multiple expansion hype.
Constraints:
• Monthly buys, not a lump sum
• 5 year horizon
• Will tolerate drawdowns, but not full capital wipe risk
• No leverage, no options for now
Question:
What sectors or specific tickers would you actually research today for this bucket, assuming you already have broad market exposure elsewhere?
Looking for reasoning, not ticker spam.
Already maxing boring stuff. Where would you park 200/month for 5yr upside without full casino risk?
byu/Shoddy_Bid_6364 ininvesting
Posted by Shoddy_Bid_6364
3 Comments
If you mean individual stocks and not ETFs, the most obvious thing would be mag 7 stocks. Those are all a pretty safe bet, tho fluctuations still happen of course. Beyond that, it really depends on your risk tolerance and how much you want to be tracking and managing your portfolio.
The simplest course of action with individual stocks is to find well established companies that have a consistent historical pattern of growth, and the current info looks good. Two stocks that were good for me in the last year are JNJ (Johnson and Johnson) and LOW (Lowes). Not glamorous or exciting at all but both have shown steady growth (and pay a decent dividend!) I invested in both because they seemed like solid dividend stocks that would also grow in value, plus both companies have been around a long time.
If you are interested in riskier, more speculative stuff- think about what your risk tolerance is and what % of your portfolio you are ok with dedicating to the higher risk level. Think also about industries you might want to investigate and search for companies. For me, that’s mostly energy sector stuff- I have some solar and nuclear stocks that are more volatile but I am comfortable with the risk because that stuff is a small % of my portfolio.
One stock I’ve been very excited about lately is RIVN (Rivian). It’s currently down right now too… a good time to buy.
Choosing one stock over others is very personal thing. It is best to read a few good books and put effort into researching each one that you like.
Then when you know the why for a particular stock, you invest. Stock picking requires monitoring too. It just not suitable to throw over the fence and carry on with your day.
It needs regularly assessing your why for it and as long as your investment thesis is true, you stick with DCA-ing into it.
Drones, nuclear power, metals, space