So...Stocks and Shares
- Thread starter JonB
- Start date
This is what I've gone for - an OEIC with an ISA wrapper (so basically a stocks and shares ISA). I've gone for gartmore china / hong kong. It's not doing too great at the moment - 14 months after starting out, it's fallen back below the level I originally invested at. Tough times for all, but the further it drops, the better it will be for first time investors.
For a fee :/ remember he is only investing 2k.
and he's 20, to be honest he would be better off saving for a deposit on a house.
As someone else mentioned, investment in precious metals is a winner at the moment, they've been on the up for years. But things dont go up forever so be wary if it looks too good to be true.
Rather than buy stocks and shares in individual companies, you should buy into a unit trust, or a range of them. You can buy into many for as little as £20 quid. Some will have general investment portfolios, others will invest in specific areas (eg green stocks, china, defense industries etc). They will also be rated by risk. Low risk trusts will have the investments spread over a large range of well established companies and industries, whilst being safer, they give lower returns. While high risk ones will spread investment over a smaller range of more volitile companies and industries with the opportunity for much higher returns.
Fees in a trust are normally lower than with a sharedealing service too
Rather than buy stocks and shares in individual companies, you should buy into a unit trust, or a range of them. You can buy into many for as little as £20 quid. Some will have general investment portfolios, others will invest in specific areas (eg green stocks, china, defense industries etc). They will also be rated by risk. Low risk trusts will have the investments spread over a large range of well established companies and industries, whilst being safer, they give lower returns. While high risk ones will spread investment over a smaller range of more volitile companies and industries with the opportunity for much higher returns.
Fees in a trust are normally lower than with a sharedealing service too
Not necessarily, you can get access to managed funds and other investment vehicles within an ISA wrapper from many providers. Hargreaves Lansdown for example charge very little or no initial fee for most of their funds, and their annual fees are often subsidized also and are therefore quite low. And because of the ISA wrapper, all capital gains are tax free (IIRC) although dividends are still taxed as income.
Also the younger you are when you get into investing and saving, the greater the benefit you will have in the future. Historically these kinds of investments outperform even the top paying savings accounts.
right! ive got 3k in a Alliance and leister isa from last year (still allowed to put £3600 in this year till april) £1000 in premium bonds and 3k in savings in current account! so i have about 4k if i was to remove the premium bonds, what would be a good idea to invest in or should i go for the isa acount again? im looking to build up a deposit for a property so any tips would be appreciated!
Soldato
- Joined
- 27 Dec 2005
- Posts
- 17,316
- Location
- Bristol
I invested £1.5k in shares when I was at university - I got given £1k from the university as access funds and I added £500 myself. Mainly it was just to get some experience - I'd always been interested in share dealing and had held a few for a while as inheritance etc.
To cut a long story short I had to sell them a few months ago to cover me starting up in the real world and was only able to cash them in for £500 (so £1k loss). I learnt my lesson and a lot aside from that, and at the end of the day I didn't really lose anything of my own (although I'd give a lot to have a spare grand at the monent!). But yeah, don't take any risks unless you can afford to lose it all.
To cut a long story short I had to sell them a few months ago to cover me starting up in the real world and was only able to cash them in for £500 (so £1k loss). I learnt my lesson and a lot aside from that, and at the end of the day I didn't really lose anything of my own (although I'd give a lot to have a spare grand at the monent!). But yeah, don't take any risks unless you can afford to lose it all.
It really depends on time frame and the risk you are willing to take.
Personally, I always fill my Cash ISA first and foremost, then I make regular payments into my Stocks & Shares ISA to take advantage of what's called 'dollar (or pound, in my case) cost averaging'. Finally I put the rest into a decent paying online savings account.
Stocks and Shares are something you should only get into when you have clearly identified your personal risk profile, ie how willing you are to put your head in the sand and ignore bad things happening in the markets in the hopes that things will pick up in the future. Your risk profile should take into account your goals and timeframes - if you want to buy a house in 5, 10 or 20 years you should adjust your investments accordingly.
Premium bonds are worthless. Why do you have £3k in a current account? You should never have money sitting in your current account, it should have been put in the ISA. I would put it all into an ISA, remember that you can transfer the money to stocks and shares in an ISA wrapper the future.
Last edited:
Associate
- Joined
- 20 Oct 2004
- Posts
- 1,485
You can sell them all, your profit doesn't cross the personal allowance threshhold for CGT so you're safe from tax provided you don't have other capital gains.
Associate
- Joined
- 20 Oct 2004
- Posts
- 1,485
There could be many reasons why he's got £3k in a current account. You should never have money in a current account? Tell that to Peter Jones who claimed to have £10m in his "bank" account.
And what do the actions of multi-millionaire Peter Jones have to do with a working class person who wants to save their few £k in the most efficient way possible?
It's completley irrelevant to his situation.
Last edited:
I don't mind admitting I'm a precious metal investor - have been for 4 years now, buying gold from £250 per ounce and will still buying be buying now at £475.
You have to worry less about return on investment and more about "return of investment" these days. With a 20%+ return this year on gold I only have to worry about burglers digging up my garden. I don't have to worry about a bunch of overpaid city types stealing it legally and charging me 2% pa for the privelage.
edit..wierd. just seen my post on page 1 from january. Almost exactly the same. Perhaps of interest is the fact the while most ETFs have been untradeable thanks to the AIG debacle (who back most ETFs using futures contracts), PHAU and PHAG are untroubled by counterpary risk as they actually store physical metal on your behalf.
Last edited:
'Never' is probably too strong a word. There's nothing wrong with having lots of money in your current account, it's just that the interest rate on most CAs is pitiful so it's a much more efficient use of your money to move it to a higher rate savings account.
I use my CA to have my salary paid into it and bills paid out from it. At the end of the month, any excess cash in there gets swept into my savings, where it stays for as long as possible to earn me interest.
Associate
- Joined
- 20 Oct 2004
- Posts
- 1,485
And what do the actions of multi-millionaire Peter Jones have to do with a working class person who wants to save their few £k in the most efficient way possible?
Just pointing out that with your expert investment advice you could reel in some high net-worth individuals and explain how they are incorrectly running their personal finances.
Anyway, doesn't make your statements any more correct. There are good reasons why you may have money in your current account. Premium bonds are not worthless.
I was talking to him, his situation. I did not say "multi millionaires should not have money in their current account", so completely irrelevant.
There is no good reason for him to just having 3k sitting there doing nothing when it could be in a savings account which can instantly transfer funds to it. Premium bonds give you less of a return than a normal savings account, which makes them pretty much worthless for him. The chances of winning loads are so low, a lottery ticket would be a better option.
Last edited:
i read a report where it compared the performance of a market analyst and a blind-randomised trial of investing, and on the whole they came out with similar results...
read into that what you will...
those shares are now worth a lot less than that...
still over double i paid for em, but it would have been nice to be triple lol