investing in shares

darcyvuqua

well i have around £500 for a trial run but how on earth do you invest and what do you invest in looking at doing it long term if i start making a couple of pound here and there any advice would be great i know i wont make millions on £500 so i am being relistic

darcyvuqua

anyone?.....

Always_smile

Hello,

Check out iii.co.uk and lse.co.uk

These sites will give you some great information to get started but one of the most important things about the forums is that you don't believe everyone. People like to hype up funds or put them down so that they can get in cheaper so make sure you do your own research with any investment. It will probably cost you around £10 per deal, you may get cheaper deals if you look around. In the past I used Barclays stockbrokers who were good but now i do everything through iii.co.uk

Good luck

Nikel

I opened a Halifax share dealing account, mainly because I also bank with them. They seem OK but its worth comparing thier fees with others.

Note the commision because that will mean you're already 'down' so you need the stock to rise to break even. I only say this because you mentioned only investing £500. Also if you're new then make sure you only invest what you can afford to lose.

darcyvuqua

thanks nikel i have £500 that is diposable at this moment in time so was going to give it a shot how long does it take before you see a return/loss on your investment

psychic_teabag

Perhaps have a go at virtual investing before playing for real - one mistake while you're getting the hang of it could put a serious dent in your already-limited funds.

I think SVS are offering the first 30 days of trades at £1 each which might be good - and after that, they still look pretty cheap at £5.75 per trade.

chris_m

darcyvuqua wrote: »

how long does it take before you see a return/loss on your investment

You'll see an immediate loss as soon as you buy - when you take into account 2 lots of dealing fees (one for the buy, one to plan for when you sell) and stamp duty on the purchase - plus the spread, the difference between the buying price and selling price

As an example, let's say you're buying shares at £1 each and dealing fees are £5.95 per trade. For your £500 you will get 491 shares, the other £9 is taken up with the purchase dealing cost and the stamp duty.
When you come to sell, if you can get £1 for them, you'll actually only get £485.05 after dealing costs - hence you've immediately lost £14.95. However, you probably won't get £1 for them due to the spread, let's say you can get 98p - after the dealing fee your holding would net £475.23, nearly £25 loss before the market variations take effect. You'd need to sell at around £1.02 just to break even, which means a share price rise of 4p - 2p gain plus the 2p spread.

As to gains/losses solely due to the market prices, that is dependent on the market - it can be seconds, it can be months or longer. I've had some shares that have sat determinedly on or around par for months, I've had others that have gone up 10% in a day, and yet others that have gone down within a day.

Hen_Step

Most big company prices do not change dramatically over a short period of time, so with commission you could be out of pocket for a while.
Unfortunately, money makes money, and £500 is not a lot.
The only way, IMHO, to make some money quickly, AND POTENTIALLY LOSE IT, would be on AIM, but you have to do a lot of research and even then it is high risk.

I have tried in the past doing what you want to do, buying Ryanair and Morrisons, after share tips in the Sunday papers, and was glad to just get my money back after several months.

web_ferret

Forget reading the papers - By the time you buy its too late.
Read bulletin boards then make your own mind up.

Thats what I do and am 30% up in 8 months.

black_taxi_2

market up about 16% in 8 months---well done doubling it