How I invest in the world's 7 largest companies

There’s been a lot of buzz in the stock market the last few weeks as Nvidia climbed to become the world’s most valuable company overtaking Microsoft (if only for a few days!). I have been closely following the news as both companies are part of my investment portfolio tool called a pie (not a steak and ale one 🥧, no).

What is a pie?

It’s an investment tool made up from several different investments or stocks in varying proportions.

This specific pie consists of the 7 tech giants named the ‘The Magnificent 7’. It also includes Google (Alphabet), Meta, Apple, Amazon and Tesla. They have slightly different weighting in the pie and its ratio can change based on their value.

The Magnificent 7 have also been behind the strong performance of most global index funds this year as they make up a significant proportion of those funds.

The pie can be rebalanced every month and if another company enters the top 7, then the shares get sold off and reinvested in a new company. It can be made up of stocks, bonds, index funds and ETFs. Alternatively, you can create your own pie as well 🍰.

What’s the risk I hear you ask…

Why did I actually decide to invest in a small number of companies when I say I avoid investing in single stocks? Isn’t this a lot more risky and volatile?

There is definitely some risk involved, but here are a few key things to note:

• 💎 I am mostly investing in my pension and stocks and shares ISA and my investments are in diversified global index funds. This a long term investment.

• 🤏 Only a small percentage of my total monthly investment (up to 5%) goes towards this pie. I still plan to have this investment for years.

• 💻 I do believe that these tech companies will continue to grow due to the way technology is developing, but of course you can’t predict the future.

• 💹 Majority of the companies have seen strong long term growth showing that it’s worth investing in them.

• 😜 This is my fun investment! I sold off my crypto and invested in this pie instead.

If you have the right strategy, you can have some fun investments too 🤸. Whether it’s a pie, individual stocks or global index funds, it can all have a place in your portfolio.

Where to invest in a pie? 👇

If you want to try investing in a pie, single stocks or an index fund with smaller amounts, Trading212 is a great platform to try. Just like with other platforms they offer a stocks and shares ISA, which is one of the best tools for investing in the UK. You can start from as little as £1.

They are also known for 0% platform fee and even have Vanguard’s index funds to choose from. Some index funds worth considering for long term investing:

• Vanguard’s FTSE All-World (acc) 

• Vanguard FTSE Developed World (acc)

If you follow this link, you can get a free surprise share up to the value of £100. If you don’t wish to keep it, you can sell it off and reinvest into something else (it’s what I did).

Want to learn some basics on how to start investing? Check out my previous newsletter here - How to ACTUALLY start investing 🚀

Lastly, please do your own research to make sure you are making the right decision for you 🫵.

My weekly recommendation

Since index funds have been performing extremely well this year, the question is whether you should be investing when the prices are this high or should you wait? Damien has a great video on this.

Want to support me?

You can buy me a coffee here ☕

Until next time ✌️

Lina at Money Blues