[Closed] Any Stock Market Traders Here?

So forgive the noob question, but is there a way to make it work starting out small(lets say £200)? Seems to me like the buy/sell fees (£12.50 typical?) will eat up a massive proportion of any likely growth?

Am i missing something, or do you really need to make larger investments for it to make sense?

So forgive the noob question, but is there a way to make it work starting out small(lets say £200)? Seems to me like the buy/sell fees (£12.50 typical?) will eat up a massive proportion of any likely growth?

Am i missing something, or do you really need to make larger investments for it to make sense?

No. You can start with whatever you have. Certainly, the initial dealing cost (about a tenner) and stamp duty (0.5%, or 0 for funds and AIM stocks) can eat into your capital, but if you're intending to invest long term the cost will become irrelevant. Charles Stanley will trade funds for free and you'll only pay the ongoing charge, but they're expensive for shares at £11.50 a pop. Funds are a good place to start as it's easier to get information about a particular sector- mines, banks etc or country- Russia, India etc than it is about a single company. The information is there but you'll get it later than everyone else.
If you intend to trade frequently you'll soon find that dealing fees will eat into your capital, and you will also lose money on most deals - that's guaranteed!
You can also add as littla as £25 monthly by DDr.

Don't forget your tax liabilities. You'd have to be making a fair bit to need to declare capital gains but IIRC dividend income needs to be declared on a self assesment.

Don't forget your tax liabilities. You'd have to be making a fair bit to need to declare capital gains but IIRC dividend income needs to be declared on a self assesment.

Though you get £5000 divi income and £11k capital gains tax free.
Open an S&S Isa. It may not make sense or save you anything initially but 2, 5, 10 years down the line it definitely will!

(Or a SIPP, and get a 20/40% top up from the gov.)

Apologies, my earlier comment with regard to dividends was possibly incorrect - what I should have said is that I personally have only made smallish amount via dividends. I am not a dividend investor nor do I know the history of the markets and therefore am not really qualified to comment about them.

Buying high yielding stocks has been a good trade over past year or so - hasnt it? My wife's income funds have done very well. I only hold on to a few banks (legacy positions) because of the yield and they have also rallied strongly on yield curve steepening (even though this is slightly misunderstanding what has been going on with their NIMs)

I check my portfolio daily but as an income investor you dont need to. I like the quarterly payers - shell, unilever, mmm tobacco, gsk.

Also, since starting my own portfoilio c 5 years ago i have never had 1 instant when all 10 constituents were in profit. There are always losses but the bottom line is the key.

As said above listen to what people are talking about, walk round thhe high streets and see which shops are busy.

Good luck, its not for the faint hearted but i consider it a fair reward for the risk involved.

Think back a year when BP and Shell were yielding 9-10% they really couldn't afford and pure vanity stopped them cutting their divis. Instead of waving their willies at each other they should have been streamlining their businesses, investing for the future in alternatives.
Shell have a new CFO starting soon. I wonder what she'll make of it all?

I started off a share dealing i.s.a around 5 years ago and have averaged 16.2% average return over that period. Funnily enough this beats most hedge funds in the city. I typically hold for around 2 to 4 months. I found out it is pretty pointless investing less than 5k as profits and compound return are to small.

and have averaged 16.2% return every year over that period. Funnily enough this beats most hedge funds in the city

http://www.cnbc.com/2016/02/16/warren-buffett-slips-but-still-winning-epic-hedge-fund-bet.html

Yes when shell was 13 quid jan 16 they yielded c 10%. Even at todays 52 week high of 23 odd they yield 5%. Now crudes at 55 usd the dividend is secure and the asset sales more likely to find a buyer. Sadly though when all is going to plan is when you get a big shock so i m looking to crystalise some gains and buy them back.

Sadly though when all is going to plan is when you get a big shock so i m looking to crystalise some gains and buy them back.

Remember, the internal combustion engine is in a similar position to the Carthorse in 1916.
Oil's on it's last hurrah...

Thanks. I stick to around 6 big companies and look for issues/problems to buy on the dip. I jumped in tesco after the big accounting dip, legal & general the day after brexit crash, easyjet recently after droppibg lots, low end of tullow oil when the city shorters went all out at it. Pick well known stocks which you like the product.

Shell have a new CFO starting soon. I wonder what she'll make of it all?

I am sure there is a joke in there!!

I'm an easy jet fan. Lots of headwinds but a well run company.

Ezj are c 10 quid, amazing its a 70% fall from its 52 week hi.

I am waiting to get back into national grid, ng, but i am hopeless at spotting the lows.

Was it not keynes who said picking the winners was like a beauty contest, but you chose the sentiment behind the judges, something like that anyway.

Just sold easyjet on monday at 10.42. Buying back in under 10.00, good profitable company, will do well long term

I currently track and trade in:
1.legal & general
2. Tullow oil (risky company but big movements)
3. Tesco
4. Glencore
5. Lloyds bank
6. Easyjet

All ftse 250 with well run businesses. I would rate them fairly low risk except tullow and glencore.

Back in Uni I used play a bit with the stock markets. I used to subscribe to a monthly newsletter and after initially being very sceptical I started buying their tips. My Best Buy was Zerco (Baltimore tech) that I bought for £3.50 per share and sold after 12 months for £21 per share. They went on to a high of £140 per share after getting a White House contract. Had I held the stock I would've been able to buy a house, instead I bought a car. I did lose on some stocks but I more than made up for it with the winning stocks. It's ok to take tips as long as you do further research.

Once the kids are full time in school I will look to getting back into it. So can you keep this thread going for another couple of years please....

Go on google and type "tullow oil share chart" click on the 5 year view option... good example of how the markets can stuff you. This is a ftse 250 which traded at £15 a few years back, recently went to £1.20 !! Now around £3. Company had good reserves and great prospects. A few really big hedge funds colluded to short tullow and drive the price down and the collapse of oil from 120$ to 30ish $ did for it. Just some perspective.. you can easily loose. You have no way of knowing what shorters will do, and its all allowed and legit. Tullow is still shorted at 14% of all shares in circulation, easyjet around 3%. No tipster saw or predicted the tullow story.

Yes the shorters do drive the price down. I have some sainsburys and at one point c 10% of their stock was shorted. They do get burnt though, its a brave call as they pay the divis while they are shorted. Double burn if it goes against them.

As said above if you dont understand what you re getting into avoid, my neighbour does all sorts of crazy transactions and despite her explaining to me many times, i still do not have a clue what she s up to.

I would suggest Funds are a good idea for the beginner as they also provide a factsheet which gives all the key info and with a little research you can learn to understand

So can someone explain, in plain English, what the shorting mechanism is and how it affects prices. Lets turn this into a learning experience for all.

Essentially it is shares lent to a hedge funds or individuals on the understanding they buy that amount back in the future. Say they borrow at £10 and close the short 2 weeks later at £8 the hedge fund profits by £2 per share shorted. They are betting on the share price going down. If it went the other way and they had to close in a rising market at £14 They loose £4 per share shorted. Think that's roughly the idea? Others may better explain.

If your buying a share hoping for a rise you are "long". If you are "shorting" you are betting on a drop.

P.s i have never shorted so may not be 100% correct. Jamba is your man to ask.

Shorting is selling shares you don't own, in the hope of buying them later once the price has fallen.
Back in the old days you would have up to two weeks to cover your position. Not sure what it is these days.

Shorting exaggerates the lows, i usually wait to see an upturn before buying. Catching a falling knife and all that. Also, most trading is done by computer now so when a stock moves out of its moving avg, the computers say buy or sell. Therefore the his and lows get exaggerated.

As said above a 5k outlay is really the min to cover fees and stamp duty. I try and make 200 profit, sometimes i hve done it in a day sometimes it takes a few months.

Nice to hear other experiences

Shorting is selling shares you don't own, in the hope of buying them later once the price has fallen.
Back in the old days you would have up to two weeks to cover your position. Not sure what it is these days.

Now you have to settle which you do by "borrowing" the stock. However this is something only big investors do, most retail investors used CFDs or spread betting to do it.

Yes the shorters do drive the price down.

Only if they outweigh the buyers, I have never understood the logic of the short-haterz

An investment involves working out the PV of a series of cash flows. The PV is either equal to the current price, above it or below it. You investment decision is based solely on which of the three is valid at any moment in time.

So what is the moral difference from acting on a stock whose current price is > than the PV (shorting) versus acting on one whose current price is < than the PV (going long)?

Only if they outweigh the buyers, I have never understood the logic of the short-haterz

An investment involves working out the PV of a series of cash flows. The PV is either equal to the current price, above it or below it. You investment decision is based solely on which of the three is valid at any moment in time.

So what is the moral difference from acting on a stock whose current price is > than the PV (shorting) versus acting on one whose current price is < than the PV (going long)?

Nature's way of telling you you've paid too much...

Naive question re shorting, but why do the companies agree to lend their stock to someone who's express interest is tanking the share price? It seems like a potentially harmful arrangement. I mean I can see that me personally borrowing BP shares to short makes no odds either way. But if your company is going through a sticky patch, and the big dogs are lining up to short the bollox of it, then I can see why you might want to say no you can't have any.

It's not the companies that lend them. It's a third party, who do it for a fee...

Thm, thats spot on re cash flows. I remember the bp md horton years ago saying a share price was simply a sum of future cash flows discounted to todays prices. I think the issue is how do you value future cash flows, even the oil majors are difficult with their reserves.

I think the brokers lend their stock out to the shorters but clearly they earn a fee and hope they get it back.

Long term investors like insurance companies and pension funds will lend to short sellers. The borrower pays a fee to borrow the stock which gives some extra income for the lender and the borrower will usually post collateral (basically give you a deposit) so the risks are fairly low. If you're in it for the long term then the short term fluctuations are largely irrelevant, so might as well make something extra from them.

I think the issue is how do you value future cash flows

I used to write stuff all about that. I am a valuation geek!!! Not on Oil companies mind.

I think the issue is how do you value future cash flows

Sceptically

Thoroughly

I used to day trade as a hobby on the NASDAQ and NYSE. With the time difference I could catch a few hours of market action after work each evening. I used a direct access platform so I bought and sold directly and could see all buy/sell orders waiting and every single trade going through. I generally held stocks from a few minutes to a few hours closing all my positions at the end of the day. I made a fair amount on tiny swings by watching the ebb and flow of how a stock was moving and buying or shorting when I felt there was going to be a small blip.

Lost on SMA and AFPO this year was up, but held on too long

88e bought in 0.79 when the well went to spufld. £1k. Price dove to 30 for weeks, I get tj jitters and bailed swearing to stop gambling on the AIM, then much to my horror 88e went off like a rocket ship to 3p plus, now around 2.6p, up around 20% last week.

I keep telling myself not to dip my toe in again, but if it drops to 2p again I might, of course that is where I will see it fall to nothing again.

Lost too much the last year. Will be playing g it safe with funds for a while.

Hopefully Lloyd's will sort itself out. I did ok day trading it when it was around 20p

S&S ISA a good place for beginners? hl? Are you able to pick funds and shares?

S&S ISA a good place for beginners? hl? Are you able to pick funds and shares?

An excellent place to start. An ISA might not save you much now, but a few years down the line you'll be glad you did.
HL are a little pricier than some other platforms but they can negotiate bigger discounts on fund fees than other brokers, which evens out the costs, but shares are free to hold. They have a bigger selection of funds than others too. Not all platforms deal in all funds- there are just too many.
Their portfolio and research pages are the best around and they have all manner of tools and features to help you.
You can trade in funds, trusts, ETFs, bonds, shares, both main market and AIM, and a fair few international exchanges to boot!

Watching with interest......1K to invest at the moment and not sure how to start or what to spread it out across!

Thankyou suburbanreuban, I'll go with them then.

Loving this thread, with 1 k i would transfer in cash to an isa and be ready to buy on the next set of bad news. Target a good income payer, google them the same names keep popping up.

Then set your target price, you can even set up a bid to buy say 50 x rdsb at 20 gbp. Rdsb is 23.3 gbp today but its always worth having a bid on. Make sure you put the bid in pence or you you may get a shock, i have done it.

Then when you have your first trade in the bag think what you want to do, hold, sell on at say 24 to bag your 20% gain. Or just hold for the dividends.

Nice thing about shell is you can see how they are doing from the price of petrol at the pumps. Pump prices track crude and shell track crude, so if i see the pump price is +2p i hope to see my rdsb holding gaining.

Above is not investment advice btw, anything yielding over c 6% is danger territory.

Or instead of investing in dinosaurs, 😉 , invest in the future; battery technology, tidal power, lithium mines or salt flats, solar, wind etc.
Energy traders are fickle souls. As the oil price rises, interest in alt energy falls and so do stock prices.
Of the oil majors, only Total is taking the future seriously. Shell's idea of alternative energy is gas! 🙄

ARL, AFC, BCN, REM,OPG, and RED are a few for starters, plus FP