Shares...Can Money Be Made in Ivesting?

nicnic1983

I am not yet a homeowner and am going to take this year to my full advantage on saving all my money.
I was given some advice on buying into some shares - To Be precise Royal Bank Of Scotland. I was advised that not only had they dropped to 0.50p from a once high £12 - but they are 60% owned by the government, so will most probably be bailed out if needed?
I want to buy at least £1000 worth.
I also have around £1000 a month in which I will be saving in all, so would really like a 100% guarentee on the government not getting there dirty mits on it, if they need it to help there neighbours out...but somewhere I'll get a little interest.
And Although no interest is made, I have heard good things about premiem bonds?
Help from someone who knows a little more than me would be much appreciated.
N.x

Masomnia

When Northern Rock and Bradford and Bingley got bailed out the shareholders lost their entire holdings, with very little hope of compensation. Obviouslyif they did get back to £12 you'd make a mint, but that would take a long, long time, years, decades? It's very high risk, and many would consider it gambling rather than investing.

So you want a standard savings account for the thousand a month?

As for premium bonds, they're only really good if you're a higher rate tax payer. Otherwise they're a bit of fun in case you win a million...

anna42hmr

the £12 share price (and infact up to around £18) was prior to a share splitting exercise that was done way before this mess, and what happend was the board of rbs cut the share price down and the existing shareholders got 3 shares for each 1 they had before so in theory no one lost out, which is why possibly unlikely to go back to those

but given that the shares at the moment are varying between £0.40 and £0.60, if you buy them now, and they go to around £3 you have trippled money

but like everything, shares are a gamble so dont invest more than you can afford

and also we have no idea when dividends will be paid again

Blah99

Do not, under any circumstances, buy those RBS shares. You would be running an enormous risk. Whoever gave you that advice is just taking a punt - "they've dropped that far so there's no way they'll go down any further" - and they are wrong. Also, in simple terms, if you buy shares in a bank and it gets bailed out by the Government, this is not a good thing for you. It's good for the bank's customers, but not for you as a shareholder.

To answer the question posed in your thread title, yes, money can be made from investing in shares. I do it all the time.

Voyager2002

Read Martin's articles before you take any risks. I would suggest a cash mini-ISA, so that you don't pay any tax on the interest and are not taking any risks. Some of the banks offer very high rates of interest for regular savings, so that might be your best option.

And take a year reading the financial pages of a quality newspaper and learning about shares and the economy before you even think of buying any yourself.

dunstonh

Investing in single company shares is higher risk investing unless you start diversifying. Buying a bank share at this time could be very good over the long term but it carries a very high risk. An example would be those that bought Bradford and Bingley or Northern Rock when they looked very cheap.

Making money from share based investments or shares is possible and many people do it successfully over the long term. Short term losses always occur but what you are proposing is more like taking a punt than investing.

evilwitch

I have personally been buying and selling Barclays shares over the last 3 months and made around £10000. My advise is watch the ranges and buy and sell at the ends. Barclays have been going between 1.40 and 1.60 so buy at the low and sell at the top.
Shares are a gamble but they are low at the moment.
However I am not a financial advisor and this is purely your choice.

gozomark

evilwitch - do you operate a stop loss ?

chopperharris

daytraders make some money from rbs , I went for a long punt on a few thousand inside an isa instead.

If rbs tanks , which is highly unlikely , but still technically feasible as the last year has shown to all banks , I will only have lost a sub percentage point of my portfolio.

If you have the stomach then do it , buy up this years 7200 shares isa , then again in april.Then forget about them for a very long time , dont watch tickers.

If you cant afford to lose the money then dont do it.

moneylover

evilwitch wrote: »

I have personally been buying and selling Barclays shares over the last 3 months and made around £10000. My advise is watch the ranges and buy and sell at the ends. Barclays have been going between 1.40 and 1.60 so buy at the low and sell at the top.
Shares are a gamble but they are low at the moment.
However I am not a financial advisor and this is purely your choice.

Would be interested to know how much your original stake was and whether you have taken out profits each time or just put more back in each time the price was low?

evilwitch

Original stake was £60k. My portfolio is now worth £70k.
I have taken the £10k out and will be investing again once Barclays hit the 1.40 mark. Hopefully in the next couple of weeks.