Short term investments returns?

Im in the fortunate position to have 60k in my sisters mortgage offset account earning me just shy of her mortgage interest rate. Her life changes mean i have to make some room in her account so need to take that money out and stick it somewhere else for a short period of time before i can use it to pay down some of my mortgage at the renewal.

So 6-18 months with a decent return?

My mortgage is 2.2% so has to be above this.

I’d move it across the atlantic now, but theres a real potential that forex rate improvement will be more significant than investment returns. (hoping for brexit in reverse here)

Whats best in the uk  for short term accessible cash without having to spend significant time playing with stock?

P2P lending?

Bear in mind im relatively cautious so buying a coke selling brothel isnt an option and bitcoin seems like the next dotcom risk to me (although inthough that about the local housing market before its last massive increase)

Thanks

Depends on how much £ and how much risk?

I’m assuming there’s no option to overpay on the Mortgage first?

P2P is quite risky and from what i’ve seen isnt offset by increased returns, that offset the increased risk.

Have a look around and you’ll be able to find fixed rate bonds or regular saver accounts that pay up to 1.5%. Just bide your time as most Building Societies will offer something attractive every now and then.

Also dont just look at the %. Calculate the extra return you get from a higher %.
It could be 1% higher, but that could just be £100 so then ask yourself if its worth the hassle.

Do your own research but i like the ftse 250 property fund fcpt.  It pays c 4% pa in divs monthly, the last year its low was 1.33 hi 1.52, today 1.43.  I turned over the stock about 4 times as it cycled 1.45 to 1.5.  Its star asset is the freehold to st christophers place, w1.  Nice.  Last year the divs and the profit from recycling netted me about 10%.

If you are interested i can tell u more, i have no vested interest in the above, other than owning q a slug of their shares.  I have the questor artiicle from feb 17if u want it.

Good luck, shares can go down too…i just top up

Don’t play fx, too short a time horizon unless you have a strong view and stomach for a big loss.

I hate P2P, it’s a potentail “train crash”

£50k earning 3% over 6 months is £750. TBH just keep it in your deposit account and forget the low return, or buy premium bonds. You could call your bank/leneder and ask if they’d accept an early repayment and adjust balance down now.

You could do alright in a tracker fund for 18 months, but investing is not really a short term investment vehicle. Some of my investments have gone up by up to 20% in the last year, but there is no guarantee, plus management costs, capital gains tax once you have maxed out your ISA.

Another gamble is buying shares in companies that pay good dividends. Hopefully the share price will go up or at least be around the price you paid, when you sell. Or even if the shares are worth less, hopefully you have made enough in dividend payments to cover the actual share value loss.

P2P lending is a gamble and not something I would risk money I could not afford to lose on.

Savings accounts are not going to earn you more than the % you are currently paying on your mortgage, but are safe and you would only be losing out on a little over that time period.

It might sound crazy, but at the moment with that kind of lump, buying a Ferrari F360 or a Porsche 911 would not only be fun for a set amount of time, but you could probably not lose and could even possibly make money on it if you buy and sell right. Obviously there are costs involved, but prices are still firm if not rising due to the lack of returns elsewhere in the investing world. I would have said safer than P2P lending.

Ultimately you are trying to do something which is not really how investing works. If it was, everyone would be doing it :-)

Cautious investor + short term timeframe…

cash is the only thing that provides that certainty and you won’t get 2.2% on anything less than 3 years.

With £60k in the short term, i’d Place a max of £2k in a sell position against any of the crypto currencies, and the remainder of it in a tracker fund against big tech companies.

crypto isn’t an investment, but a gamble, hence the low amount

high tech stocks look like a safe short term bet with FB, Alphabet and Amazon returning double digital growth in the last 6 months..ASOS also doing well in the UK.

i find eToro and their new copy funds particularly easy to use.

+1 superstu,If you cant afford to lose money you should not be in stocks.Minimum five year holding period is best.The bull market could also turn in the net year or two.

Higher returns come with greater risk, which everyone knows, but also with greater variance.  It’s this second part that makes it doubly hard to make a short term return, because you don’t want to be in a trough in 6-18 months time.

I’m almost totally invested in stocks, but this is with a 25 year+ timeframe in mind.  Considering that we’re at a market high (historically judged anyway) then I’d only go stocks if you’re looking 10 years plus.

Also, avoid forex.  It’s a casino bet pure and simple.  There are multiple Phds in maths and economics buying and selling huge amounts, at tiny spreads, setting the price.  The price is the market price.  Guessing whether these guys have got it right one way or another is gambling.  Heads or tails, red or black.

The classic answer to such a problem is bonds.  Slow and steady without the drama of the stock market short term.  Long term stocks will win, but that’s because they bounce around so much and individually represent a higher risk.  Here’s a 10 year snapshot to give you an idea – it’s the US market, but it mirrors the UK.

If it were I for 18 months then I’d go 100% UK gilts (VGOV) or if I were feeling a bit more optimistic then maybe 80% VGOV and either 20% global equity (VWRL) or keeping it all UK then 20% VUKE.

This gives an idea of what happened to the Total Bond Market (Green is 100%) and Total TSM (pink is 100%), and ratios in between, around the last two crashes.  Burgundy is 80% bonds for example…

VGOV costs 0.12%

VWRD costs 0.25%

VUKE costs 0.09%

Do it all online through a low costs provider.  All of those are vanguard, so makes sense to go with them and use their own funds to save transaction fees.  Or just go with AJ Bell/Hargreaves/etc.

I’m not qualified in any way financially.  Take this advice as it is – from someone you don’t know on an MTB forum!

Stick 50k in premium bonds. This time next year Rodney, you could be a millionaire*.

* you could also still only have your 50k mind

you can often put 10% of the mortgage value into your account without penalty – its also worth checking what the penalties are of going beyond that – my repayment fees in the last year are 1% of the value being paid off. I doubt you’d get much more than 1% after tax on safe short term savings in the UK

We have a similar amount in premium bonds at the moment and it’s doing alright. You can stick a max of £50k in, we wanted short term risk free so that was the best option.

Yes premium bonds, 50k at 1.4% avg should get you 2 min wins pcm.  Tax free too.  I d max out on premium bonds over a 1 to 2 year period.

Saying that, theres a few shares i have my eye on tht if they drop much i ll get in.

I d prepay all my years big costs and speculate with the balance.

Good luck anyway, i see even prov financial gained 5% today on new ceo news.

I d max out on premium bonds over a 1 to 2 year period.

There’s a £50k max holding per person, you can’t add £50k per year. So £50k in premium bonds and the other £10k in a current account of some sort, Santander 123 probably your best bet.

DO NOT TOUCH THE PROVY.REPEAT.

My Wife has had a couple of K from Premium bonds recently. Personally I take a chance on P to P lending and average 11% return. Its just an addition to my portfolio but its giving me the best return. Most loans are around 6/12 Months.
My Bank insisted that I have a Financial review, the young lad said I should not be investing in P to P. 5K interest on 25K invested says I am doing alright by it.

When we were in a similar position with having a large amount spare for a short period we just stuck it in premium bonds, had a few wins and definitely came out better than we would have having it in any savings account.

Premium bond holders – are you getting the 1.4% avg?  I appreciate smaller holdings may not get it due to prize win size, but i am going to buy some.  Thanks in advance and sorry for thread hijack.

I think its about that. Certainly pretty close. Its actually quite fun. We often get 2 or 3 cheques a month. They all come at once in a distinctive yet plain envelope. Its almost always £25 each but you never know…