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The Stocks and Shares ISA deadline day for this year is 5 April. This means that an investor can invest money in the ISA up to a £20,000 limit. After the deadline day, the new year starts, meaning that from that point an additional £20,000 can be invested if someone has the money. Here’s my current game plan both for the coming days and for the coming year.
Mostly looking beyond this week
I’ve not allocated any more money to my ISA in the last few days. I don’t have the spare cash to do so, but there’s an important lesson here for other investors. Just because there’s a £20k ISA limit per year, it doesn’t mean I have to hit this mark. I haven’t fully utilised it this year, but that’s fine! Rather, investing the money I have when I can afford to makes sense. I don’t have to put myself under undue pressure simply because the deadline is looming.
A second point is that I want to focus on saving to allocate for the new ISA year. The earlier I can free up some money to buy stocks with, the better. The benefit of compounding returns (particularly with dividend shares) means that time in the market beats trying to time the market. So as soon as I do have funds available, I want to be ready to rock and roll.
Finally, I use the deadline week as a good time to review my overall portfolio. I check and see whether I currently have too much exposure to a particular area of the market, or if my conviction towards any of the companies has changed. This then helps to guide me in what I’ll look to buy for my ISA in the coming months to fill any gaps I’ve identified.
Thinking about future themes
For example, one area I know I don’t have much exposure to is AI. I’ve been a bit slow to get started on this theme and could do with increasing it in the coming months. To that end, one idea I’m considering is CoreWeave (NASDAQ:CRWV).
The business went public last week, so it’s a completely fresh US stock for investors to mull over. It’s a cloud computing company that specializes in AI-focused infrastructure. It makes money by selling access to computing power to other companies that are pushing AI forward. What I like about the business is that it already has long-term contracts in place with some large players, such as OpenAI and Microsoft. To some extent, this guarantees steady revenue streams, which is important for a newly listed public firm.
It could do well going forward in taking advantage of the continued AI boom. Particularly in the AI cloud market, I think there’s huge scope for growth in the coming years.
One risk is that CoreWeave highly depends on a few major clients, such as Microsoft. If one of these clients switches to another provider or builds its own AI infrastructure, revenue could take a major hit. Despite this concern, I think it’s a stock I’ll add to my ISA when I have some free cash in the coming month or so.
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