10 Best Apps for Timid First-Time Investors
Investing in the stock market for the first time is intimidating, but it doesn’t have to be. Twenty years ago, if you wanted to start investing, you might have called a full-service broker on the phone who charged outrageous fees just to make a trade. Now, discount brokerages and do-it-yourself models allow regular people to make their own trades for a fraction of that cost -- and user-friendly investing apps allow anyone with wifi and a bank account to start playing the stock market from the comfort of their phone.
As a first-time investor, even if you understand how the stock market works, you might not know how to play the market wisely. Luckily, there are apps designed specifically for novice investors -- the technology is simple to understand, yet the features are comprehensive. These apps not only facilitate stock purchases, but they can help compare fees, offer investing suggestions, analyze mutual funds, aggregate net worth or even track cash flow.
If you want to start investing in the stock market, fire up your smartphone and download these 10 apps.
The Acorns app is a great choice for first-time investors. The app allows users to “invest the change” by linking their credit or debit cards to the app, which rounds up regular purchases and invests the difference into a diversified portfolio of index funds chosen by Nobel Prize-winning economist Harry Markowitz.
The beauty of this system is that it makes investing easy and painless for a first-timer, no matter how much money he has, Jeff Cruttenden, cofounder and COO of Acorns, told GOBankingRates. “Acorns is designed for new and experienced investors who want a quick, easy, and automatic way to invest their money," he said. "People can get started in seconds; then set it and forget it.”
While the ability to make small-dollar investments is appealing, the nature of the fee structure means your investing should be frequent. Acorns charges a monthly service fee, which is a small percentage of your account balance. So, if you leave a small lump sum of money in your account over a long period of time, the fee could eat up your balance, even if the market is performing well. Your balance should be large or constantly growing if you want to come out on top, which is easy if you follow Cruttenden’s advice and just “set it and forget it.”
2. Stock Market Simulator
The Stock Market Simulator app gives you the ability to try before you buy. Users can play a simulated version of the real U.S. stock market and invest virtual funds without taking on any real risk.
Accounts start with $10,000 and the virtual stock market gets updated 15-20 minutes behind the real U.S. market, meaning you can track your investments in real time. This app shouldn’t be used as a decision-making tool for actual trading, though -- it’s just a great way for first-time investors to get their feet wet and learn how the stock market works without losing any actual money.
SigFig is known for its online investment tools that track, manage and optimize existing portfolios, but it also allows users to manage their investments 100 percent through the app. Users just need to sign up, take a risk profile questionnaire, confirm a personalized investment plan and then fund the account. Investments are pulled into a single dashboard and offer a real-time view of every stock, mutual fund, ETF and other investment.
First-time investors can get help optimizing their portfolio with SigFig’s investment advice engine, as well as receive up-to-date market news and stats on relevant companies. The first $10,000 in your portfolio is managed for free, but, unlike some other investing apps, you will only get a three-year overview of your brokerage accounts, even though some investors prefer a 5-or 10-year look back.
4. Motif Explorer
Motif Investing investigates trends and world events that could lead to investment opportunities. Then the company builds portfolios, or motifs, based off related stocks. Some examples include clean tech or companies tied to the housing rebound, which are all current trends.
The site requires a $250 minimum and charges a commission of $9.95 for a portfolio that contains 30 stocks and ETFs. The Motif Explorer app allows users to monitor motif performance, find new ideas and review performance charts. And if you aren't a Motif customer, you can still use the app to create lists of favorites and get more details about any investing ideas you're interested in. This system might not be best for large investments or retirement portfolios, but Motif makes small-time investing fun and relevant -- it's a great way to introduce new investors to the market.
5. Yahoo! Finance
Taking a cue from its mega-popular iOS weather app, the Yahoo! Finance app is designed for a beautiful, personalized user experience. In fact, the design is so sleek that fans of this app compare it to iOS 7's native Stocks app. The Yahoo! Finance app allows users to sync portfolios and quotes across multiple devices, tracking stocks, currencies, commodities and more. The interface is ideal for conducting a quick stock check and the push notifications allow you to stay current on breaking news so you can make informed decisions on the companies you invest in.
6. TD Ameritrade
The TD Ameritrade app focuses on the basic essentials of investing: mobile access to trading, streaming quotes, real-time balances, fund transfers, and up-to-date news and market research. What makes this app particularly unique is the Snapstock™ feature, which allows users to snap a picture or barcode on any item to find the company name, ticker symbol and stock quote, along with company-related news and charts.
7. Fidelity Investments
Once you have started feeling comfortable with investing, the Fidelity app is a good next step up from beginner programs. The app allows you to trade and track your accounts anywhere from a mobile device and recent new features include customizable home screens, additional money management tools, advanced charting, daily market videos and option trading. Users can transfer funds using an external bank account or by uploading an image of a check. Bill pay is available for certain accounts and there is a menu featuring news covering U.S. and international markets, technology, mergers and acquisitions, IPOs, and more. Account holders can create watch lists, as well as price trigger and trade notification alerts.
One of Warren Buffett’s top pieces of investing advice is to read five newspapers a day. If you don’t have the time for that, start here: The CNBC app -- take this review: “Provides everything I need to read, hear and see related to business and financial news each day. The interface is user-friendly and pleasing to the eye.”
Benzinga offers an app that gives investors instant access to auto-updating stock quotes from any mobile device. This is a good option for investors who want immediate information, up-to-date quotes and breaking news. Social media fans will enjoy these additional features: tweets for trending stocks and news articles, and the capability to share content on social networks. Users can also opt in for breaking news push notifications, create watchlists and explore predictive quote search.
When first-time investors get more experienced, they can upgrade to BenzingaPro, which offers three more subscription levels to choose from. Subscribers can select from services ranging from the basic streaming news and data service to a premium subscription that includes an audio news squawk and instant analyst Q-and-A.
The Bloomberg app combines breaking financial news and real-time stock tickers for major and minor stock exchanges that both causal and active investors can appreciate. One reviewer noted, "If you're more interested in world and financial news than you are stocks, Bloomberg doubles up as a great resource for such information. It ties news and the stock market together in a fluid way that users will appreciate."
You can customize your own stocks in the application and get a comprehensive view of your position in the market. Users can also get personalized news on companies in their watchlist, for the real-time, relevant information they need to make smart investing decisions.