The Best Way to Invest 1 Million Pounds in the UK
If you have the opportunity to invest 1 million pounds and you are looking for the best way to invest it, before you chose where, you should consider a number of issues.
One of the main things to think about and is also well-known saying is, “Don’t put all your eggs in one basket”.
Even if you have done your due diligence and you think a certain investment type is safe, there will always be a degree of risk that is involved. There are low risk investments and high risk investments, but no-risk investments are effectively nil.
Therefore, the clever way to invest a million pounds would be to spread the risk.
Diversification is a way to lessen this risk by distributing your funds throughout a variety of investment vehicles such as stocks, bonds, mutual funds, business, property and alternative investments, to name but a few.
As a general rule, the higher the return on investment, the greater the risk will be. Low risk investments will typically yield very little.
This website is on the subject of foreign currency exchange investments. Moreover, it is about managed forex accounts at the time of writing this article, although it has started to explore other forex openings.
I won’t go over the subject too much on this page because I have covered the topic in depth throughout this site. You can start reading about them here. I just want to show you how much profit is achievable by using these accounts.
In a nutshell though, managed forex accounts are foreign currency exchange accounts that are traded by professional traders and are managed by a management company for the investor.
The management company make their money by charging performance fees and in some cases, admin costs.
The investor supplies the forex broker with a “Limited Power Of Attorney” to permit the trader to undertake trading. The client has total control of their own account and can credit and debit funds, and close the account when they want.
Investing 1 million pounds in a managed forex account can be a higher risk than many other types of investments, although these risks can be mitigated to a great degree by choosing one that A. is regulated by the FCA for example and B. has a 3rd party audited proof of profits.
As an example of profits that can be made with £1,000,000 pounds, please check out the image below. These figures are based on an initial investment of 1 million pounds, a 30% performance fee and an average monthly return of 5%.
As you see, after one year, the initial investment of one million pounds has accrued to a value of 1.5 million pounds. After 2 years, the value has risen to almost 2.3 million pounds.
If you want to play around with the figures, please check out our interactive compound calculator below – from where you can enter your own investment amount, performance fee and average monthly interest.
There are basically two types of investors that invest their money into a managed forex account, those that want a monthly income and those that want to let their money compound in their accounts for capital growth.
There are some people that take out half profits for a monthly bonus and let the rest compound. Some withdraw profits until their capital is recovered and just let the rest accrue in the account.
Is this the best way to invest 1 million pounds? Or any other amount from £10,000 pounds upwards, the answer to that is different for everyone. It depends on what your end goal is, monthly income or capital growth, low or high risk, low or high returns on investment.
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