Investing money from a cash ISA into funds?

ricll

Hi guys, I haven't got much money invested, it's basically 13K in an A&L savings acc paying 2.33% gross(1.74%) + HSBC reg savings 8%, in which goes £250/month + HSBC Cash ISA 1.74% (allowance used 2008) + some cash in 2 current accounts.

I'm thinking of taking most of the cash ISA and investing in oil funds&shares at HL, 2 of which would be http://www.h-l.co.uk/shares/security_chart/sedol/B15KXV3 and http://www.h-l.co.uk/shares/security_chart/sedol/B29VF35 . Besides I intend to use some money to do some day trading too. What do you think of this 2 funds specifically?thanks

wombat42_2

You mean "saved" not "invested". Getting into oil shares could do extremely well but it is not a certainly - it is still a risk. You are gambling. How would you feel if you lost most of it ? Personally I would leave your savings alone unless you are prepared to invest for 5 years plus and you have other decent cash savings.

a7man

I'm bored of these answers...standard boring regurgitated paragraphs.

He asked for an opinion on the funds. He has cash savings, why miss this opportunity to invest?

cheerfulcat

ricll wrote: »

I'm thinking of taking most of the cash ISA and investing in oil funds&shares at HL, 2 of which would be http://www.h-l.co.uk/shares/security_chart/sedol/B15KXV3 and http://www.h-l.co.uk/shares/security_chart/sedol/B29VF35 . Besides I intend to use some money to do some day trading too. What do you think of this 2 funds specifically?thanks

I would be very careful with the ETF - do you know anything about how it is structured? This has been discussed on TMF - here's a quote from one poster who looked into CRUD

I've just followed up by speaking to a very helpful and straightforward chap at etf securities. Basically we are right to be concerned! CRUD is based on selling the front month between 6th and 10th (i.e. a couple of weeks before expiry) and rolling this into the contract 2 months out. e.g. the March contract has just been sold and the May one purchased.

Currently the March contract is $38.4 and the May contract is $47.4. So that's a 19% hit. If that level of contango persists then that would soon mount up into a massive loss, especially if the PoO remained becalmed at current levels. Even with rising PoO you have to run to stand still.

If you go to fool.co.uk and look at the iShares and ETFs board you'll find the rest of the discussion ( look for post number 1892 - sorry, can't do links right now ), as well as some suggestions for tracking the price of oil.

ricll

yeah i've actually got money saved and not invested just yet. Still reading into ETFs cheerfulcat, will have a look at those posts, thanks.

edit: just found this http://ftalphaville.ft.com/blog/2009/02/24/52836/the-united-states-oil-fund-mystery/ for those interested in oil etfs

dunstonh

From cash to high risk and nothing in between. Thats a bit of a leap. Are you sure you are ready for the jump in risk?

wombat42_2

dunstonh wrote: »

From cash to high risk and nothing in between. Thats a bit of a leap. Are you sure you are ready for the jump in risk?

Thats what I was trying say with my "boring" post.