Spare me the lectures, I save a good regular sum into a long term savings plan and the same regular sum into an instant access e-saver. I figure I can afford to sink up to £100 a month into something like a speedtrader account without changing my savings behaviour. I'm going into this with no expectations whatsoever; my father has always told me to be wary of trading stocks but I'm curious and want to learn something new. So, the questions. What are some good resources on getting up to speed before I get my feet wet? I have a full time job that takes place during trading hours. Can I trade outside of these hours and realistically expect to make a return? I will be sticking to markets I follow out of professional and personal interest. Is this a good idea? What kind of information should I be attuned to when making purchasing decisions? As an individual trader, how much of a disadvantage am I at compared to big money traders? I prob have more questions but those are the main ones at the moment.
You want to pm thestockbroker (TSB) unless he is lying and his real job is something other than his forum name!
I agree with your dad, when he says to be wary of stocks. Investing in a company = giving other people complete control of your money, and hoping that the company does as well as you can only guess it might. There are so many variables that determine the fate of any company, and the same sort of problem exists with investing in commodities. I bet TSB can recommend some good resources to learn, and sure, study up, tread carefully, and keep a very close eye on whatever company or commodity you invest in, then sure, you can make money whilst you sleep. It can be a good idea to invest in markets that you have a personal interest in, as not only does this mean you already have some knowledge in what you're investing, but also that you probably won't get bored to death monitoring everything.... assuming you can remain unbiased when making your decisions! As an individual, a big problem you will probably face, is potentially losing more than you can easily afford to/not being able to keep yourself afloat to survive through a crash. Another problem is more of a hindrance, where you can find what looks like a golden opportunity, but you can't afford to whack a heap of cash into it, just in case it doesn't work out well. Don't forget: Heaps of experienced investors, suffer massive loses, many are driven bankrupt (the one's that can't afford to lose too much), each time there's a totally unexpected crash I still think investing is extremely important, and that it should be well taught within maths and history classes from primary school, since if you don't invest, you can end up barely being able to support yourself in retirement
I'm in a similar possition to fod, but msybe with a little less money to spare. I'm interested to get into stocks but every thing I look at has such a large commision (£7-£10 per trade) in relation to my fiarly small investment that even with say £500 to invest the stock would have to raise by at least 1% before I break even. I had a quick look at speed trader mentioned above but it looks like you need a US SS number to be able to register. I've throught about buying gold in the past too either held in an on line account for me or actually buying small gold bars but again the admin charges (or postage and then telling my contents insurance I have £500 gold bars in my safe) seems to out weigh any potential earnings I may make. The other thing that bothers me is at the moment I don't have to fill in a tax return as it's all handled by PAYE but am I right in thinkin if I buy stocks I'd have to fill in a tax return every year?? as this in itself would end up costing me more in time and effort than I'm likley to make on my investments.
Gentlemen! Fortunately for all parties involved, I ended up not being a licensed commodities trader of any kind. I'm actually a newbie reinsurance broker (no trading involved). However, at the time of signing up to BT and pretty much for as long as I can remember, it was my desired career choice (dream, aspiration w/e), and so naturally I read investment & financial risk management at uni. SO! Sharing what little I remember. It's pretty speculative stuff; surprisingly so. There can be as much or as little math/science involved as pleases you, and a seasoned investors 'hunch' is as likely to reward dividends as a carefully calculated, well timed and perfectly executed buy/sell transaction by the brown-nosing new guy. For what you're contemplating, an execution only service, as you've said I would go as far as to say; to not even consider anything outside your immediate interests - this is the best case scenario. Hoping you have some semblance of what affects ordinary share pricing, you'll be able to make assumptions about how external factors/influences in your desired field will benefit or impair your relevant investments. This is otherwise very difficult to do as a private starter when you know nothing about what you want to invest in. I'm not going to go into much more detail than that, unless it's requested, because I have the feeling that what I'm about to tell you now will probably just put you off completely. You say you have no expectations, let me help you out: Expect to actually owe in excess of your investment every month if £100 is your desired monthly investment (If your agreement with your broker even allows this, there is a likely minimum investment) Expect any return you make at this level to not even begin to compensate you for your time spent in addition to the above Expect to fall foul of wanting to recoup costs incurred by your broker through 'risky' investments, and thus losing more money and incurring additional costs. Expect it to overall, be much more hassle than it's worth at this level of investment. You see, you're not really investing your money as such, you're gambling with it. Gambling dangerously. Gambling dangerously, with a cost incurred every bet. Even moreso, when the costs are hidden and not immediate, and your money appears only as figures on an internet webpage. In short, don't do it. To make it worth your while, you'd probably have to take a tiny bit of equity out of your mortgage/home, or raid your savings. - Neither of which I'd recommend at all. If you're just interested in learning a bit more about/actually playing the markets a little - We could set up a Bit-Tech league over on Bullbearings.co.uk? It's a great, free, fun resource I've used time and again - and you could try your hand at trading without spending any real money (Essentially see how much you stood to lose, your shame documented by the BT community) /rush TSB
If you have an interest in markets , stock and finance in general, I would recommend looking at spread trading. I've been doing it for 7+/- years. IMHO several points: Save up and have £3000 pounds that you can afford to play with. As in, if you fail, you won't be bankrupted and be on the streets. DO NOT BORROW your start-up capital. Educate yourself thoroughly on all the markets available. I have around 8000 items that I can spread on. Each market has a character. Take advantage of the free trial offers at the spread brokers. Play with the supplied monopoly money as if it was your own. I did not and it cost me dearly when I started properly. I could go on and on, however I don't know OP's situation and keenness to trade. For me, spread trading has been good and vastly superior to vanilla stock buying.
As the Boss (TheStockBroker) says: stocks may go down as well as plunge. Evening out all the usual fluctuations, stocks increase in value by 11% a decade. Yes, that's the kind of time scale you have to think in. Now ask yourself: how much is inflation over a decade? Yup, you got it. Stocks are a gamble. You may get lucky and catch a wave like e.g. Mobile communications in the 90's, or be able to ride the .com boom and bail out just before it busts, but generally it's not that simple. And it today's economic climate, I would avoid stock markets like the one-ball-three-cups street scam that they are. Put your money in an ISA. It's the only way to be sure.
Ok, thanks for all the info. Looks like I'll wait 'til I have more disposable cash; which will be a while since I'm currently spending every penny on doing up my house And nexxo, where do you think my regular savings amounts are going I opened and maxed out a cautious growth fund with natwest the other week, and have a standing order putting 1/3 of my disposable income into it. The other 1/3 goes into an e-saver, and the other 1/3 gets, er, disposed of. This should hold up for the next five years at least, at which point I'll probably want to look into splitting it into higher and lower risk funds.
Sorry to hijak but does anyone just have any general saving advice outside of just keeping money in a savings account/ISA? I'm a complete moron with this stuff but would like to have some savings that essentially wasn't just cash. Next time we're in a boom I'm buying gold... however one goes about buying gold. I always wanted to buy 100,000 tonnes of coffee in the commodities market and then go, WELL, WHERE THE HELL IS MY COFFEE!? AMERICANOS FOR EVERYONE! (Skinny latté for TSB 'cause he's a trendy London type.)
I'm certainly no expert but from when i was in the same position as you it looked at getting in to the stock market i would have needed 10K spare to get any meaningful return on investments. That and the possibility of entering another recession shortly has put me off. As to Zinfandel i've got steady return out of government bonds in the past few years more than i would have through ISA's. Is supposed to be a very safe investment though maybe not so much now that some governments are in danger of defaulting.
Yep. I was looking at stock trading, but for the amount of money I could afford, it wasn't worth it. Unless you have over £10K to invest, and a lot of time, it ain't worth it. And I doubt you would be anywhere near as successful as Warren Buffet. Mind you, Bolivia has a lot of lithium. Maybe, if lithium batteries become more popular, ????, and PROFIT
I think the best that I can recommend is to educate yourselves as to the many ways to invest money and to get involved with your money movements. I won't say that ISA's are bad, because I have some myself, but my Equity ISA has been losing money like a ***** for the past 2 years. Even the best ISA around at the moment is hardly out-performing RPI. You'd be lucky to get RPI +2% using regular banking offers. If you don't want to work for your money, fixed-rate ISA or a fixed-term saver is the way to go. Unless you have an obscene amount of money, I'd avoid money management provided by the likes of Morgan Stanley etc. My mother was paying out more for their services than she was making, almost a net loss of 2% ex inflation. Although I did initially get into trading hoping to strike it good and find the next Apple, I soon learn't the error of my ways. With careful and methodical spread trading it is very possible to achieve a consistent 1-3% per month. (obviously risk/reward ratio is important)
I recently put all of my savings in a NSA bond but they have now closed for the year, keep an eye out for next years ones if they run them as they match inflation + 0.5% for 5 years
Equities generally (c wut I did thar) out perform standard savings accounts. Every decade except the last one did. When investing in the stock market, ALWAYS invest for the long term. Have a look at fidelity.co.uk - they are a huge financial services company with a big fund supermarket. I invest in their Moneybuilder UK fund - it has very low management fees (essentially their charge for investing in the fund). The minimum lump sum to begin with is a £1000, then a minimum of a £50 a month. Investing monthly long term will result in larger portfolio because if the market goes down, your £50 will buy MORE shares not less, so when the market grows, you grow faster. This fund simply tracks the FTSE 100, plain and simple. The next funds I'm looking to invest in is China + India. These funds track the Chinese and Indian stock markets, which over the LONG term are guaranteed (as guaranteed as anything is in life) rise as these economies will massively larger in 10 years time. Again, if you comfortable putting away this money with the knowledge your money can half in value in the short term, then go for it. I'm 24, so its a no brainer. Remember, you can invest in these funds as part of your stocks and shares ISA allowance, meaning if these funds quadruple in value over a few years, which is perfectly reasonable, its all tax free and its all yours.
That can be a great idea, a lot of money can be made with houses... sure, a lot can be lost too, but property is pretty easy to research, no need for much gambling.... if for example, Bob carefully invests £100 a month in property... and if things just plod along, Bob could look forward to making £100k by the end of the decade. That £100 per month could possibly double some years however, due to maintenance issues, etc, but even if Bob ended up spending £200 per month for a whole decade, to make £100k profit, that would work out to ~42% return pa, less inflation = ~38%pa. If there's a boom, and/or if Bob is skilled with his property investing, well then it could be two or three times as much ...but if Bob chose poorly and there's a crash, then Bob could end up making no profit on his £100 per month by the end of the decade Investing doesn't have to be gambling, it can be educated decisions Whatever investment you choose, you need to take inflation into account. If you have a savings account earning 10%, yet inflation is 4%, then you've effectively made a 6% return.
It all depends on your motivations. I'd like to present an alternative viewpoint and strategy. I invest in high risk AIM listed oil stocks and some (many?) people would call me an idiot for doing so. I started out knowing very little with a £500 "bet" that BP had been massively oversold in the wake of the Deepwater Horizon disaster. I made about 15% profit in a few months, but then I saw all the talk about Rockhopper (RKH) and their two-month rise from around 50p to £3. That got my attention. Since then my portfolio's made huge gains and huge losses (it's worth half what it was six months ago), but I'm still ahead and looking at a fair chance of big gains over the next six months with my 'favourite company' (Range Resources: RRL). The AIM market is down a lot right now and many companies are looking cheap, but the risk is still there. Above all else, you need to be incredibly careful. Always be comfortable with the idea that your money could vanish overnight. Spread Bets are the absolute worst for this, as with the majority of accounts you can lose considerably more than your deposit. Take the wrong position and you could well owe thousands. That said, I've enjoyed the ride and when money's on the line you have a real incentive to learn about the businesses you're investing in. No-one ever got rich from Cash ISAs and savings accounts.
Finally a decent Stock thread Playing on a very low level, that's what it is...playing. Use only money you can afford to lose. That's where my wisdom ends. I'm in pretty long term (semiconductors...talk about volatile), in Semi, there's a rise every end of year, but the heigt is always different (now is a dark perion for Semiconductors by the way...which opens up opportunities) Have I had gains? certainly. Have I had losses? Yes, large ones (should have opted for Ford over GM, nuff said) It actually equald out over the years, giving me a slight gain. It is fun though.
Found this thread from a link, some very good info. Loz - how do you invest on the AIM? What are the charges/fees etc?
