Nigel Farage looks as though he is backing a DIY approach to investing, which would be monumentally risky for inexperienced investors – as I flagged up in a recent video in my YouTube Channel.

Within a daily finance-orientated newsletter, the Brexit Party Leader’s team urged readers to “tell us about your successes by going it alone – leaving the money men and middlemen by the side of the road…”

Of course, successful DIY investing is possible, but is not recommended for the majority of people. It could end up being a very expensive, distressing exercise.

Going it alone can be such a huge risk for inexperienced investors, as the complexities could end up sinking their portfolios.

Maybe this is the reason why around two-thirds of wealthy individuals consult a professional financial adviser, as per new findings from the University of Toronto.

These findings echo a global survey recently undertaken by deVere, which showed that one of the biggest investment mistakes made by HNW participants was not having previously sought financial advice.

As such, I would urge anyone who praises the virtues of DIY investing to also highlight the risks and possible pitfalls that must be avoided.

A professional will help investors to make the best investment decisions in five key ways:

First, helping with portfolio diversification. Spreading money around is crucial to limit risk. That said, it must be used in the right way. Diversification will only add real value if the new asset has a distinct risk profile.

Second, investing with a plan. Unless a sound plan is involved, it’s not investing, it’s gambling.

Third, circumventing emotional decisions. Being overly emotional can be disastrous when it comes to investments, as they are shattered by prejudices and biases.

Fourth, regular portfolio reviews. Investments must be consistently reviewed to make sure they still belong in the portfolio and remain on track to hit long-term goals.

Lastly, fifth, a pro will ensure investors do not focus on historical returns. The investment situation in the future will likely be different from time-aged averages.

Although investing is almost universally recognised as one of the best ways to generate, amass and protect wealth, taking into account the pitfalls of getting it wrong, it could be a very costly mistake not to seek professional advice.

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