Advice please for stocks & shares

cashsaver

I wonder if anyone can give me any info about stocks and shares and where to start to invest. As a complete novice to this I am interested in any books (comprehensive!!!!) that helped anyone else in the same situation. Many thanks.

paul666

Some down to earth stuff here:
http://www.fool.co.uk/lrninvnov.htm?NavLoc=LN&NavFrom=personalfinance&NavTo=investingBP

superscotsman

Before you buy anything, start a make-believe portfolio, and pretend to buy and sell for a few months. Any beginner's mistakes you make will then not cost you a penny. Look at shares you select: if the company is stable, the price will go in cycles. The price tends to rise just before the dividend is paid, and falls sharply after the dividend has been paid out. That is the time to buy. It is up to you to work out whether it is worth your while selling before the next dividend is paid.
Talking about the stock market as a whole. When the FTSE index has never been higher, you look about your portfolio and you decide what shares you can get rid of without incurring loss. You then put the money in the bank until there is a bear market. You do not buy. When the stock market collapses or there is a severe bear market, you buy when you judge the market has bottomed out. You might now ask how does one know when the market has bottomed out. The answer is, I am afraid, that you don't. If the market suddenly collapses while you are holding loads of stock, the correct thing to do is to hang on to everything and wait for the market to go back up again. Do not sell.
A lot of people ask how does one know when to buy and when to sell. There are two answers and they are the same in both cases: too early and too late.
If you want to hold stock safely, only trade in blue chips.
The stock market can be a lucrative place, and in the long term will yield you more than the bank or building society, and is lots of fun. But if you are impulsive and lack patience, it will chew you up and spit you out. You have been warned.

kinster_2

I got the Motley Fool UK Investment Guide and it's great

cloud_dog

Cashsaver

I would strongly recommend Superscotsmans idea to 'paper' trade, i.e. register with a web site and most will allow you to maintain one, or more, portfolio's of pretend share holding. I run a few portfolio's with www.iii.co.uk (usually for watch-lists). Secondly if you are a novice investor with no investment experience there are a couple of things you may want to consider / do:

1) Have you got sufficient savings for a rainy day?? (utilise your mini cash allowance)
2) Would recommend you start by opening a monthly savings / investment plan with a top ranking Investment fund manager, and would suggest you stick to a good UK fund initially. This would allow you to ignore peaks and troughs and trying to time when to invest (called pound cost averaging, i.e. buy more when the shares a cheaper and less when they are more expensive)

Lastly, with all due respect to Superscotsman , I think there are way too many inaccuracies, assumptions, and risky suggestions in the remainder of the post for a novice to be considering.

As stated previously by Superscotsman if you really want to get into actual stock picking / investing then again, I recommend 'paper' trading for a while. This may also help give you time to save some funds if you do not have an ready funds available.

cloud_dog

p.s. ***ONLY*** invest what you can afford to lose
p.p.s Remember if it looks TOO good to be true, it often is!!!

cheerfulcat

Hello, cashsaver,

The Motley Fool books and website, as already advised, are a very good place to start learning about investment. For a beginner I would also suggest Alvin Hall's " Winning with Shares " . There is also a basic web-based course ( free ) in investing available here - http://www.incademy.com/pages/home.htm?ginPtrCode=10002

I would echo Cloud_Dog's caution regarding superscotsmans post ( no disrespect intended, ss ).

About fantasy portfolios - they may or may not be useful for *trading*, that is, relatively rapid moves in and out of shares, but I feel that they are not of much use for investing, which is carried out over a longer period. In any case, you learn a *whole* lot faster when you're losing real money :-)

Cheerfulcat

cashsaver

Thank you for recommendations for Alvin Hall's book and the course..... even better that it's free!!! I will be checking them out.

cashsaver

Thanks... I will certainly look into papertrading and heed your advice about investing only what I can afford to lose. Sound advice.

cashsaver

cashsaver

Thanks Paul666.
I already recive the motleyfool newsletter so I will look up their investment advice too.

cashsaver

Thank you for your advice.... I am sure I have enough to now get me underway!!!!
Good luck on your potential house ownership in Yorkshire!!

cashsaver

superscotsman

cloud_dog wrote:

Cashsaver

2) Would recommend you start by opening a monthly savings / investment plan with a top ranking Investment fund manager, and would suggest you stick to a good UK fund initially. This would allow you to ignore peaks and troughs and trying to time when to invest (called pound cost averaging, i.e. buy more when the shares a cheaper and less when they are more expensive)

Lastly, with all due respect to Superscotsman , I think there are way too many inaccuracies, assumptions, and risky suggestions in the remainder of the post for a novice to be considering.

The assumption I have made is that anyone reading my missive wanted to do-it-themselves. I have nothing in particular against what you are suggesting. There are many ways of investing the market. I am only sharing the niche I have created for myself. I will rejoice if there is a war is threatened with Iran. Then the market will collapse, and I will then go steaming in with my waiting money, and buy up the blue chips.

There is a flaw with your argument, and it is this: find a good fund manager. OK, suppose you tell us what a good fund manager looks like. To my mind it would be easier to find the company. I sold one stock when they sent me a brochure which contained a photograph of the manager who was managing my fund. There, standing there grinning in a royal blue Savile Row suit was what looked like an eighteen-year-old with a faceful of plooks. I sold that stock as soon as I could.

What you are suggesting is investing in unit trusts. If you want a unit trust, the easiest way to go about it is to take out a life assurance policy. How about investment trusts instead? That way you can buy at ex dividend (my suggestion) and still get your spread.

So far as I can see, there are no inaccuracies in my previous posting: in the words of Hunter, "It works for me."

I don't think I have said anything risky. If you want risk, try penny shares and mining companies.

You are right to say that you could lose your shirt on the stock market, but if you're scared of losing money, stay away. It's as simple as that.

You'll get better odds on the stock market than you will in the bookies.

That's the way I like it, baby; I don't want to live for ever.

Oh, and - er - don't forget the Joker.