Newbie thinking about getting into shares.

Pocketsaver

My university recently gave me a £1,500 scholarship for studying with them. I don't need this money in the slightest so I see it as a nice bonus (doesn't mean I want to be careless with it).
With the money I've decided to throw myself into the world of shares and stocks. Only problem is that I know nothing about it.
I'm thinking of using LloydsTSB's share dealing (what are they like?). Used the search engine to find out more about it, but it seems LloydsTSB share dealing hasn't been discussed before.

Any advice appreciated. Thanks.

Lokolo

Lloyds charge £15 to deal online

iii charge £10 to deal online.

If you are going to invest in 1 company it will cost £20 + 0.5% to buy and sell. Which means you will have invested £1470 (approx) from your £1500, which means you will be at a £30 loss before you even start.

If you decide to invest in 2 shares to spread the risk, then you it will cost £40 + 0.5%x2.

3 shares £60 + 0.5%x2...

etc.

It's quite expensive to invest, but if it's money you could quite happily lose it all. Buy 1 share, I just don't recomend it!

hbakhshi

Have a look at x-o, they charge £5.95 per online deal.

Also have a look at ETFs, no stamp duty.

psychic_teabag

I think SVS have a special offer with trades for the first 30 days at £1 or £1.50 or something like that. Thereafter £5.75 per trade. I don't think they support an ISA (whereas x-o do).

With portfolio builders (iii or halifax), you can buy for £1.50 on certain days of the month, but selling is around £10. One buy/sell cycle ends up similar to x-o.

Did you consider just buying funds instead. (Boring, but...)

Ifts

Might be worth you setting up a practice account before you commit real money, much cheaper way of learning if things go wrong!
Don't know if LloydsTSB's share dealing offer it but the Share Centre allow you to set up a practice account without risking your own money.

Heres the link for the Share Centre: Practice trading shares with FREE practice account, you will have to register but its free.
Once you have registered you will have access to advice to help you get started and research tools so you can learn more about the market.

Always do your own homework/research and never invest money you cant afford to lose. Good Luck!

Pocketsaver

I have already used my ISA allowance for the year. Is it necessary to have an ISA (apart from avoiding tax).

The Practice account looks like an excellent idea. I'll take a look into all the sites as well.

Thanks all.

Hughesy84

Pocketsaver wrote: »

I have already used my ISA allowance for the year. Is it necessary to have an ISA (apart from avoiding tax).

The Practice account looks like an excellent idea. I'll take a look into all the sites as well.

Thanks all.

Yes the paper trading is well recommended, whilst you do it try to learn the market, understand all the ratios and p/e's etc and also get a good understanding of the tax rules so you dont lose it all at the end.

psychic_teabag

When you say you've used up your ISA allowance for the year, do you mean your full ISA allowance (£10k), or just the maximum cash ISA allowance (£5k). If it's just your cash ISA allowance, you still have some remaining S&S allowance. http://www.moneysavingexpert.com/savings/ISA-guide-savings-without-tax#invest

But no, it's not necessary to use an ISA - depending on whether you keep investing, you may in the future regret not having fully utilised your ISA allowance.

Pocketsaver

A couple of questions I have from my research so far

1) My reading around the website and Sharecentre have made me aware that some shareholders get benefits depending on the company and the number of shares you hold with them. Do all share's sites list the benefits and what you need to qualify for them?

2) Posts I have been reading here have mentioned a website by the name of 'h-l' (name currently escapes me). What is this?

3) If I were to sell my shares:
a) is it difficult? i.e. is it as easy as clicking 'sell'?
b) What kind of charges would I be likely to come across? If it depends on the value of the shares, what if it were £100's worth
c) If I were to sell multiple companies' shares at once, rather than one company's at a time, is it cheaper i.e. bulk sale discount? or are you only capable of selling one company's at a time?

psychic_teabag wrote: »

When you say you've used up your ISA allowance for the year, do you mean your full ISA allowance (£10k), or just the maximum cash ISA allowance (£5k). If it's just your cash ISA allowance, you still have some remaining S&S allowance. http://www.moneysavingexpert.com/savings/ISA-guide-savings-without-tax#invest

But no, it's not necessary to use an ISA - depending on whether you keep investing, you may in the future regret not having fully utilised your ISA allowance.

I had an ISA with LloydsTSB (probably put in about £2,500 in it for this year) but closed it in December because I am a student and don't earn past the personal allowance. When I closed it, I think I remember them saying that I wouldn't be able to open another until the next tax year. I'll be opening a ISA next year anyway as I finish my MA in September and start work somewhere between then and Jan 2012.
I'll probably play safe and say I'll continue investing for the foreseeable future.

psychic_teabag

Pocketsaver wrote: »

I had an ISA with LloydsTSB (probably put in about £2,500 in it for this year) but closed it in December because I am a student and don't earn past the personal allowance. When I closed it, I think I remember them saying that I wouldn't be able to open another until the next tax year.

Yeah, that's your cash ISA allowance gone, then, but you can still invest up to (£10,200 - £2500) in a S&S ISA this year. You can fund one cash ISA and one S&S ISA per year.

(Actually, while it's not strictly allowed, you might still be able to open another cash ISA this year - called a "self transfer" or something. Search on the forum for details if you care.)

psychic_teabag

Pocketsaver wrote: »

2) Posts I have been reading here have mentioned a website by the name of 'h-l' (name currently escapes me). What is this?

h-l is Hargreaves-Lansdown - a discounting ISA / SIPP provider. They're considered good for funds, but less good for shares (relatively high trading costs plus annual fee). I get the impression some people seem to consider them a triumph of marketing over content - if they get hold of your address, they do tend to inundate you with brochures and stuff.

http://www.h-l.co.uk/