Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to johnstevens77,Bhoddhisatva,scotia,Anonymous,Cornytiv34, for Donating to support the site

You will be pleased to hear...

Investment discussion for beginners. Why you should invest your money, get help getting started
stooz
Site Admin
Posts: 1447
Joined: November 3rd, 2016, 11:03 pm
Has thanked: 10 times
Been thanked: 502 times

You will be pleased to hear...

#144364

Postby stooz » June 7th, 2018, 9:03 pm

Ive bought a share ISA :D Still deciding on which fund manager and fund and risk... might end up just plumping for a mixed pot of funds as decided by H&L...

Its all a bit scary!

LooseCannon101
Lemon Slice
Posts: 252
Joined: November 5th, 2016, 2:12 pm
Has thanked: 302 times
Been thanked: 147 times

Re: You will be pleased to hear...

#144376

Postby LooseCannon101 » June 7th, 2018, 9:39 pm

A beginner can be led astray by their friendly stockbroker who is interested in selling as many different products as possible and changing the selections according to the latest tweet e.g. from President Trump. A more profitable course of action is to choose a highly diverse world equity fund with a long pedigree, buy monthly and re-invest dividends.

Such funds exist in the form of investment trusts e.g. Foreign and Colonial (FRCL), Witan, and Alliance. I have held FRCL for the past 20 years and not been disappointed with the results, 9% per annum on average - doubling in value every 8 years. The 'Rule of 72' states that a fund will double in 72 / % per annum. Hence, at 12% per annum it will double in 6 years, and at 6% per annum it will double in 12 years.

A good book to read for beginners is 'The Intelligent Investor' by Benjamin Graham. Warren Buffett - a student of Graham and one of the most successful investors of all time, thinks that the average investor should buy a highly diverse equity fund and hold it forever.

Urbandreamer
Lemon Quarter
Posts: 3121
Joined: December 7th, 2016, 9:09 pm
Has thanked: 347 times
Been thanked: 1025 times

Re: You will be pleased to hear...

#144409

Postby Urbandreamer » June 8th, 2018, 7:10 am

Welcome to the larger world of investing.

Depending upon your reasons it can be great fun, or a worthwhile effort.

I invest for the fun of it, so when I make mistakes I shrug and carry on. I've been at it almost 30 years and am happy with the returns.

If you are just interested in the returns then there is a strong argument for minimising costs and effort. There are a huge amount of options that can do both, and others that promiss greater returns at higher costs (at this point many will think "but they don't always manage that", while others will claim that they can't manage that). You can pick index trackers or ETF's (ETF's are cheap index trackers with a different legal structure), or "ethical" funds that avoid certain types of business.

I'm not going to critisise FRCL (I hold it myself) but you do need to think about what you want and why you are doing this. FRCL has out performed the market, but is that what you want? If so why FRCL rather than SMT or PCT? They have both done better than FRCL. While I haven't paid much attention to PCT, SMT (who I also own) have warned in the past that those who own it should expect high volitility (risk of loosing money just when you need it). By the way the SMT costs are quite cheap while PTC costs are not, though I doubt that owners of PCT are unhappy given its performance. I expect that FRCL will be less volatile than either, which would make it a better choice for some.

Even index trackers (which involve no effort at all) have some volatility. My company DC pension is almost entirly invested in index trackers and reported that I lost money last year! I'm quite happy about the fact, after 10 years of stonking gains, and given the fact that 2 months on the gain on the last 12 months is 7%.

You are stepping through the looking glass, walking through the wardrobe or that mysterious door that you never noticed at the bottom of the garden. I hope that it's fun and magical rather than too scary for you.

BTW early march I opened up JISA's and invested in CTY and SMT. Their "portfolio" is up 12% since then, though I'm not sure that just two investment trusts count as a portfolio.

AleisterCrowley
Lemon Half
Posts: 6381
Joined: November 4th, 2016, 11:35 am
Has thanked: 1880 times
Been thanked: 2026 times

Re: You will be pleased to hear...

#144511

Postby AleisterCrowley » June 8th, 2018, 1:42 pm

stooz wrote:Ive bought a share ISA :D Still deciding on which fund manager and fund and risk... might end up just plumping for a mixed pot of funds as decided by H&L...

Its all a bit scary!


Trouble is, if you ask 50 people on these boards what to invest in you'll get (at least) 50 different answers.

A lot of it depends on your personal situation - income, tax status, attitude to risk, investing 'horizon'/age blah blah..

...deciding on which fund manager and fund ...

there's a lot of evidence to suggest that the majority of actively managed funds don't beat the index, and that trying to pick a 'winning' fund manager based on past performance is no better than random pin-sticking..

I started out with an index tracker (FTSE100) and gradually moved into individual shares.

If you buy a cheap tracker you get instant diversification, and it's low maintenance. It doesn't remove risk of course - the index can drop most alarmingly!

In my opinion (I am not an IFA) , for most people, most of the time, a cheap tracker from the likes of Vanguard is the best option.

Pipsmum
Lemon Slice
Posts: 325
Joined: April 12th, 2017, 11:18 pm
Has thanked: 56 times
Been thanked: 125 times

Re: You will be pleased to hear...

#144528

Postby Pipsmum » June 8th, 2018, 3:00 pm

The HL select growth fund has been producing the goods repeatedly in mine so far. Currently 8.72% ahead with a monthly saver option, and has been higher recently.

Even Neil WF's new income focus fund pays the yields out repeatedly even though the overall price is wobbly compared. Makes it better value because it's still below the starting block price and is currently @97.06p. Overall growth down on mine by 3.43% but keeps on paying out more than my yielding shares @ approx 3.6% if my maths is right.

I'm sure there are better ones but I've not been unhappy with these two. As long as it goes up more than a savings account, and not down, then I'm content.

AleisterCrowley
Lemon Half
Posts: 6381
Joined: November 4th, 2016, 11:35 am
Has thanked: 1880 times
Been thanked: 2026 times

Re: You will be pleased to hear...

#144554

Postby AleisterCrowley » June 8th, 2018, 4:30 pm

Several years back I decided to invest in a couple of ITs
One was a lump sum, and one I started as regular investment plan
The lump sum one was SMT, and the regular investment one was CTY
Guess which one has grown massively :-(
Overall I'm happy with my investments, as they have outperformed cash savings by a long way. I haven't checked how they've performed against a cheap tracker, but I doubt they've outperformed - they may even be lagging. Still, it's been a learning experience!


Return to “How Do I Invest”

Who is online

Users browsing this forum: GeoffF100 and 6 guests