[Closed] Investing in shares, any advice please?

Buy low, sell high.

Thanks Mc top tip! I had it the other way

I got into shares about 18 months ago when it was relatively easy to make money as everything was so depressed. With some basic research it was relatively easy to return a profit.

I used the following site to track prices. It's free to register and you can set up a virtual portfolio to track share performace. the Forums are also useful

http://www.lse.co.uk/

As for tips - I almost exclusively used the Questor section of the Telegraph

http://www.telegraph.co.uk/finance/markets/questor/

If, like me, you can't be bothered to do your own research these are pretty good and they are generally on the money.

The problem with shares is that you can become obsessed by it! I was looking at the prices almost every 30 mins at work and I'd have to check the prices as soon as the market opened at 8:30 every morning. I almost became a day trader and it got a bit too much of a distraction so I sold up and banked the profit.

SJ
Thanks thats exactly the type of info i was after

Cheers

We had some investment on 2nd and 3rd year at Uni. Looks like quite good money can be earned on mergers and acquisitions. For example, if a company merges or aquires another company, the aquired company's share price will rise but the buying company will probably fall. Recent example: Lenovo just bought Medion. Medion shares go up 17%, Lenovo shares go down 3%. Similar to Cadbury and Kraft.

It's just the timing and following informations really. A good buy and hold strategy with investing in FTSE100 (simulation with real stock market prices) was as good as shuffling shares all the time and buying and selling as the fees were lowering our profit.

A simple and easy way that our lecturer believes in is to buy shares with low P/E ratio (around 10 or under) as they might be undervalued but within FTSE100 to keep the risk down. A fairly low risk investments got us a result of around 7-8% gain in a month, which was about the same/a bit higher than FTSE100 return in the same time.

I know it was virtual money but we still did the research and had to be up to date and it takes time. For example one pharmaceutical company, we bought it cheap as it had a case against it for loads of £££, it made a provision so lowered it's profit. Case was won by the company, provision went back to profit and hey presto share price went up, we made a profit.

[edit] also another thing we learned is to diversify your portfolio to lower risk

If I was investing my own money as I'm risk averse I would buy something well established, FTSE100, check charts for recent performance etc it will still give a better return with a dividend and profit from sale than a normal bank account that gives something around 2-3%
[edit]

[img] [/img]

I think many western economies have recently got themselves into a situation similar to Japan in 1990. We'll see. I've been playing the markets for years, did very well in the 90s (as did most people), sold the lot in March 2000 and have dabbled without conviction or success since.

Which broker do people use to buy the shares too? Halifax appear to charge £11.50 is that a good rate?

On a share related note does anyone want to tell me why my lloyds ones are sinking like a heavy jobby at the minute? They were got instead of cash payouts on stuff but I fear I may have fluffed that one 🙁

Don't forget that if you get involved with a city trading house, they're all off their heads on charlie and haven't the vaguest clue about what they're doing, even though they think they have...

(See related thread "world leaders...")

LOL Mr Woppit - Think I just wee'd myself. Probably because I'm so high I can't control myself. 😆

Which broker do people use to buy the shares too?

I use iii.co.uk

Selftrade are not a good broker. Choosing funds in a stocks and shares ISA is another way to do it. I use Hargreaves & Landsdown.

Cheers guys!

On a share related note does anyone want to tell me why my lloyds ones are sinking like a heavy jobby at the minute?

PPI compensation.

Xcgb - how much are you looking to invest? Have you considered Unit Trusts instead of equities? Pool your cash with other investors, have it managed by an experienced fund manager and reap the benefits of diversification. You also don't pay stamp duty or commission with most brokers.

Rondo
Not sure yet but between 5-10k I hadn't considered unit trusts no, but sounds good, will look into it how do they make money without commission though?

Thanks

Ok so this is how!

Typically you will pay an initial charge of 5% to 6% and an annual management charge of between 1% and 1.75%.

don't put all your eggs in one basket.

look at investment fund or share accounts. less risk as investments are spread over more companies/industries, but therefore returns maybe lower than buying a lump of shares at once.

my money went up 8k in the last few months, but it had lost 3k in the months prior to that....

+ 1 Hargeaves & Landsdown.

Cheers alpin

And how would you start? I mean, what do you need to do to start buying/selling shares? Do you need to go to the bank or what?

Ok so this is how!

Typically you will pay an initial charge of 5% to 6% and an annual management charge of between 1% and 1.75%.

Discount brokers like Hargreaves Lansdown or CoFunds will reduce the initial charge down to typically 0.5%-0%. They make their money directly from the fund manager so don't charge you commission on deals. The AMC is not charged to you directly, but taken from the value of the fund & it's charged so that you don't have to do the research on the underlying stocks! Choose a sector for investment & allow the fund manager to pick the best companies in that field.

If you're buying shares in individual companies, you'd need to be investing at least £1000 in each stock (otherwise minimum commission rates mean the % is quite high), so in order to get a reasonably diversified portfolio you'd need to be investing at least £10k. You need to extensively research your intended investments before investing & keep a close eye on the prices. My portfolio is a mix of Unit Trusts (probably 75%) and high-risk equities (AIM-listed Natural Resources stocks), but I'm reasonably young & in for the long term.

If you're doing it to make profit set yourself two absolute(ish) figures for each holding that you have. One figure is the price at which you sell a falling stock and the other is the price at which you sell a rising stock. It's too easy to hold on expecting losses to be stemmed or profits to keep rising.

Consider buying stock in companies that are gaining foothold in emerging markets; for example pharmaceutical or beauty product companies that will sell easily to the wealth-improving social classes in countries like China, Brazil, India etc.

Keep on top of your portfolio, particularly when speculating. This takes ALOT of time and effort.

Currently I think the market is overpriced and I am expecting a correction. But, who knows how long the madness can continue.
They are just bloating the suckers up for the maximum payoff when they rip the rug out from underneath the unwarey.

Also, Although it is now June, don't forget the old saying

"Sell in May, go away, come back on St Ledgers day."

I'm feeling bearish, so would only consider taking out short positions at the moment.

simple advice from a simple bloke. only invest what you can afford to lose.

Thanks Mc top tip! I had it the other way

Me too - I have the bank statements to prove it 😥

I worked at a stockbrokers once, looking after loads of accounts etc. The MD gave me some sound advice, don't invest any money that you can't afford to lose. The company made its money by investing or advising on other peoples' money.

Here's a tip from someone who has worked in the stock market for over a decade: Don't do it. Invest your money in property or bonds. Unless you can afford to potentially lose it all, or have at least a high five figure sum to invest, forget it.

I wouldn't see it as an investment, more a bet.

I not keen on bonds right now. Interest rates are more likely to go up than down IMO which will hit bond prices.

Property is volatile too so unless you get an excellent rental return (unlikely at present prices) I wouldn't put everything in that either.

Shares have their place in everyone's portfolio IMO, just make sure that you can take any losses and are prepared to sell to either take profit or take a loss on the chin. Do nothing to actively manage and you'll do no better than bonds long term.

On a previous Nikkei forray I was down 50% at one point before eventually selling at +20%. On the latest Nikkei escapade I'm at -18.8% and on one bank -81%. Going away on holiday when a banking crisis starts can be expensive.

Top replies guys!

Some wise words indeed, Thanks

XC

xcgb,

Go here:

http://www.fool.co.uk/

and sign up (free) for much better financial advice than you will get on any biking site.

You might want to start on this board:

http://boards.fool.co.uk/absolute-beginners-investing-50014.aspx

Make sure you know why you are investing (not just greed) and what your goals are. Don't invest any money you can't afford to lose.

It may seem like it but there is no easy money to be made on the stockmarket. Read everything you can for at least 6 months and don't be afraid to ask loads of numpty questions, we all had to start somewhere.

The market may well go up in that time but don't be too anxious to get in quickly. It will still be there when you are more knowledgeable and less likely to make silly mistakes.

Forza
sensible advice Cheers!