Investors Club/How do i go about buying shares?

nessiehibs

Hi, new here. :beer:

Right, looking for a little bit of advice here, I and a few family members have chipped in a little money (£450 gross) and looking at investing in shares.

Now, we are all novices at this, so aren't really sure where to begin.

1) Where do we buy shares from, preferably the cheapest possible way

2) How much will each transaction cost

3) Should we be looking to focus on 1 maybe 2 business since our investment is small in order to reduce the amount we give to 'the middle man'

4) Should we ever consider switching which business we invest in, if so how often should we switch


Thanks for any help guys, much appreciated. :cool:

P.S. sorry if this is in the wrong section, but i couldnt find anything that seemed more relevant to what i was asking than 'investing' so...

nessiehibs

*cough* bump *cough*

cheerfulcat

Hi there, nessiehibs,

With that amount of money ( unless you missed off a few noughts! ) you'd be best off looking at investment trusts rather than individual companies. I'm having computer problems right now so can't post a link but Google for " Association of Investment Companies " for more info.

To be honest though, I think you'd be better off trying to raise a little more capital - at very low levels of investment, costs will take a very big bite out of your nest egg.

nessiehibs

Thanks CC.

Ill give that a google and see what can be done Re more funds.

sabretoothtigger

I think 500 would be the minimum for investment in a fund.
50 per month is a better idea because then you dont lose if the market bombs in any one month, like it has in this past 4 weeks

Or you could bung it into one of these bank offers, the rbs one at 65p is apparently considered cheap and its an open offer so doesnt that mean anyone can do it or maybe I misunderstand.

The advantage of such a small amount of money is you dont have to care too much about it and after all these banks are guaranteed now?


A tracker fund would normally have the lowest costs, 0% initial and 0.5% or less charge per year. In theory you'd get almost the same performance of the ftse

Compare that to 10 pounds of dealing costs to 500 pounds of shares, that 2% not including duty which is 0.5% I think (plus another 2% to sell unless they double which is fairly unlikely)

Blah99

nessiehibs wrote: »

Hi, new here. :beer:

Right, looking for a little bit of advice here, I and a few family members have chipped in a little money (£450 gross) and looking at investing in shares.

Now, we are all novices at this, so aren't really sure where to begin.

1) Where do we buy shares from, preferably the cheapest possible way

2) How much will each transaction cost

3) Should we be looking to focus on 1 maybe 2 business since our investment is small in order to reduce the amount we give to 'the middle man'

4) Should we ever consider switching which business we invest in, if so how often should we switch


Thanks for any help guys, much appreciated. :cool:

P.S. sorry if this is in the wrong section, but i couldnt find anything that seemed more relevant to what i was asking than 'investing' so...

1) You use an execution only broker like Interactive Investor. You open an account with them then transfer your money into it. You then decide what shares you want to buy and use the online trading interface to buy them.

2) Depends on what broker you use. III charge £10 per buy or sell, plus you pay 0.5% stamp duty on each trade. The normal trade charge is in the £10 to £15 region.

3) I don't understand your question. If you're self-trading through an execution only broker there is no middle-man as such. There's the £10 fee you pay your broker to buy or sell the shares (and hold in a nominee account), but there's no middle man like an IFA etc that will get commission on your trade. Investing in multiple shares in different sectors is good practice as it diversifies your risk.

4) You make decisions on buys and sells based on fundamental or technical analysis of a company, or a combination of both.


£450 is nowhere near enough money to invest in shares. If you search this forum for my posts I gave a long explanation of how trading costs will eat your profit margin and demand unrealistic returns on small purchases.

If you're interested in stock markets the best thing you can do is start reading as much as possible. Buy "The Naked Trader 2" to get you started, then "Charting" by Alastair Blair. Buy the Investor's Chronicle magazine every week. Then you'll start getting a feel for what you need to learn.

barak

nessiehibs wrote: »

.....I and a few family members have chipped in a little money (£450 gross) and looking at investing in shares.....
Now, we are all novices at this, so aren't really sure where to begin.

I suggest you have a look at this site which you might find useful -

http://www.proshareclubs.co.uk/