£1000+ to invest, who should I go with?

EnzoMan

I'm looking to get involved in using a £1000 fund to invest with a company who offers investments. I'm not looking to top up the investment, month to month just place £1000 down for a year or more.

I'm looking on feedback from you guys on who I should go with and if you have started out just like me only having such a small amount to invest and then what you might have worked up to.

I'm currently looking at TSB and First Direct...any stories to share?

EnzoMan

I'd like to add...

I've been reading some of the other posts and seen some of the amounts of cash you guys have been investing, I know that my amount doesn't seem much in comparison, I still hope I can find someone who might be able to help a small fish in a big pond.

Loughton_Monkey

If you 'Invest' for a year, then that's rather a strange strategy.

Investing is considered to be a 5 to 10 year job. What you would be doing is 'gambling'. In a year's time, your £1,000 could be worth anything between 40% less, or 40% more.

Very few of the 'seasoned' investors here would go to a bank. They tend to offer rather lacklustre investment products at the top end of charging rates.

Perhaps it's best to think again? Either put it into a good cash ISA or if you want to invest it, then think of a much longer period.

xrjtg

If you do want to invest with such small amounts then look up unit trusts and OEICs (open-ended investment companies). These are funds that pool your money with that of other investors and manage the lot in return for an annual fee, typically somewhere between 1-2%. Banks will sell you these, but they'll generally be expensive and poor performing. For a wider choice, and lower costs, investigate a discount broker/fund supermarket like Hargreaves Lansdown.

EnzoMan

Loughton_Monkey wrote: »

If you 'Invest' for a year, then that's rather a strange strategy.

Investing is considered to be a 5 to 10 year job. What you would be doing is 'gambling'. In a year's time, your £1,000 could be worth anything between 40% less, or 40% more.

Very few of the 'seasoned' investors here would go to a bank. They tend to offer rather lacklustre investment products at the top end of charging rates.

Perhaps it's best to think again? Either put it into a good cash ISA or if you want to invest it, then think of a much longer period.

Thanks for the feedback. I am more than happy to place the money away for a longer period of time, since you suggest there is more chance of a return on it. I assume it's more common for you to top up the investment yearly or monthly, something I can't do monthly but maybe a small amount yearly.

I know I'm starting out small with this but I am not looking for great risk as you can see I don't have much to begin with and would just like to get a feel for how this works.

I asked my bank about it the other day and they really tried to talk me away from the idea saying that it would be a waste of my time.

xrjtg wrote:

If you do want to invest with such small amounts then look up unit trusts and OEICs (open-ended investment companies). These are funds that pool your money with that of other investors and manage the lot in return for an annual fee, typically somewhere between 1-2%. Banks will sell you these, but they'll generally be expensive and poor performing. For a wider choice, and lower costs, investigate a discount broker/fund supermarket like Hargreaves Lansdown.

I'll look into that, thanks.

Ps. I forgot to multi quote, sorry...

xrjtg

Don't let people put you off by telling you it's a small amount. I started with less, and you'll be learning about the various kinds of investments as you go.

hbakhshi

xrjtg wrote: »

Don't let people put you off by telling you it's a small amount. I started with less, and you'll be learning about the various kinds of investments as you go.

Good advice and I agree. Remember, everything on here is just opinion, and yours is as valid as anyone elses. Just be aware, as soon as you invest, the value of your investment will initially go slightly down. This isn't anything to worry about its normal and how the brokers make some of their money, on a spread.

I suggest you look at one of HSBC's index trackers as a first investment, they have a FTSE 100, FTSE 250 or an All Share. Use H-L as suggested or Fundsnet or Fidelity. This sort of investment is at risk to the markets and will go up and down. If you are a nervous type then a cash ISA would probably be better. If you can take a long term view, then it should be OK.

I too started many years ago with less, but every pound saved now is worth two or three pounds saved in ten years time. Compound Interest is a wonderful and powerful thing, just try and leave your money in there as long as you can.

EnzoMan

hbakhshi wrote: »

Good advice and I agree. Remember, everything on here is just opinion, and yours is as valid as anyone elses. Just be aware, as soon as you invest, the value of your investment will initially go slightly down. This isn't anything to worry about its normal and how the brokers make some of their money, on a spread.

I suggest you look at one of HSBC's index trackers as a first investment, they have a FTSE 100, FTSE 250 or an All Share.

I'm going to have a look on the HSBC site to see if I can find this type of investment. Some of the terminology is still confusing me though.

hbakhshi wrote: »

Use H-L as suggested or Fundsnet or Fidelity. This sort of investment is at risk to the markets and will go up and down.

What does "Use H-L, Fundsnet or Fidelity. Why use them? I'm confused, I'm currently trying to read up as much as I can.

Nikel

H-L = Hargreaves Lansdown

EnzoMan

Do all of you use Hargreaves Lansdown, Fundsnet or Fidelity? Are these good companies for someone starting out like me with such a small fund?

xrjtg

Investment funds are products, and like many products you can buy identical versions from multiple places. Typically you'll be charged 4-5% up front when buying funds, which is traditionally used to pay whoever advised you to buy the fund for their advice. If you buy direct from the fund managers then they will still charge you the 4%, but it will go straight into their back pocket. Discount brokers like HL have been set up for people who don't want the advice they're notionally paying for: in return for not giving you any advice about what to buy, they promise to refund most of the initial charges, which has the advantage of greatly reducing the fee you pay, sometimes to zero.

So if someone advises you to use HL, they're advising where to buy from, rather than what to buy.

EnzoMan wrote: »

I'm confused, I'm currently trying to read up as much as I can.

Absolutely the best thing you can do. Stick at it, and you'll get the hang of it soon.

EDIT:

EnzoMan wrote: »

Do all of you use Hargreaves Lansdown, Fundsnet or Fidelity? Are these good companies for someone starting out like me with such a small fund?

I do use HL, but that means that I've bought funds from perhaps 10 different managers through their platform, not that I've specifically invested in any products managed by HL.