Instead of sticking your cash in an account and getting interest, you invest in a fund (wrapped by an ISA so you get some tax benefits) who invest it in stocks and shares. You get a choice which funds to invest your money, I went for a UK high risk (i.e. they invest in about 30-40 companies on the FTSE 100) and an Asian high risk (same but in Asian stock markets). Roughly speaking, the value of the unit trust grows as the share price increases - long term these have proved higher growth than cash ISAs (the Asian fund grew at approx 20% a year for the last 5 years (past performance not indicative of future performance etc). The risk is that your investment can shrink and you will get charged management fees.
I started one in February this year and earlier this week I was still 5% down
I was 10% down after the management fees
I daren't look to see what the value is today
Having said that, I'm wondering if now would be a good time to transfer money out of my cash ISA into the equities one.
I have 2 cars, my own flat and spend too much on going out and booze
certainly sounds worth looking into, I guess its a sort of risk and reward type jobby? bigger risks of it losing value but more chance of making money on it compared to a standard ISA?
