Amateur investor

The term Amateur investor is often quoted in the UK press as a term of derision, indicating one who invests blindly or is influenced by romantic notions rather than hard facts.

The press highlight both the Irish Property Bubble and the British property bubble, for example, the margin which has driven the market to new highs has been the amateur buy-to-let investor. In a downturn, they might also provide the marginal sales which drive prices lower.They are in general
* More willing to pay over the odds
* Unaware of, or they prefer to ignore, all tax implications
* Completely dependent on capital appreciation to show a profit

Some people's view is that the amateur investor sector's latest entrants will be all but wiped out in the event of stagnation or a property hard or soft landing. This is because their "business plans" factor in capital appreciation, without which they can only trade at a loss.

However, many amateur investors are savvy individuals who make wise and calculated investment decisions and use their investments to supplement their income or provide for their retirement.

In this sense, the term amateur simply highlights that investing does not constitute their main income.

See also

* Investor - types of investors