How to get into shares?

WilliamO

Hi All,

Hopefully I am in the correct forum? If so, I would like to know what is involved in buying shares.

Questions:

1) I understand I would need a broker? If so, can anyone recommend a good company/agent? I am in London.

2) What fees should I expect to pay? Admin fees? Broker fees? Buying Shares fees? Costs?

3) Are the shares taxable?

4) If I went and bought shares in British Gas for example can I go directly to them and buy shares or do you need a broker by law?

Any help appreciated.

WilliamO

R_P_W

Find yourself a couple of books that are an introduction to investing as a first step. Im sure someone else will recommend some.

You need to really think this through and understand the risks before you take the plunge and buying anything.

vacheron

Agree with above that a couple of books would be a worthwhile investment, personally I found the Naked Trader books to be informative while being a lot more lighthearted than most.

The type of broker depends on whether you want an advising broker or an execution only broker. The fees for an instant "execution only" trade (if you are making just a couple of transactions per month), will consist of a fixed broker fee of around £10-£15 and you also need to pay stamp duty at 0.5% on any share purchases.

Clearly the trading fee can take a large chunk out of a low value trade, so if you are thinking of dipping your toe in the water with a few smaller trades, then perhaps take a look at the Halifax Sharebuilder account, which is not an instant trade, but allows you to share your dealing charges with other investors at IIRC £1.50 / trade and is a good way to steadily build up a small portfolio.

BLB53

Find yourself a couple of books that are an introduction to investing as a first step. Im sure someone else will recommend some.

For a basic introduction I recommend 'Slow & Steady Steps'
http://www.amazon.co.uk/Slow-Steady-Steps-Wealth-ebook/dp/B007EBLN3G/ref=sr_1_37?s=digital-text&ie=UTF8&qid=1343379464&sr=1-37

also Naked Trader is worth a read
http://www.amazon.co.uk/The-Naked-Trader-trading-ebook/dp/B005OPGDO8/ref=sr_1_1?s=digital-text&ie=UTF8&qid=1343379401&sr=1-1
both are currently in the top 20 best seller list for investing.

Also have a look at the Monevator site - lots of really good articles and sound advice on many different aspects.

As for brokers, you probably need an online broker eg sippdeal.

Good luck!

WilliamO

Thanks for the advice and recommendations. Just want to clarify:

All I want to do is know how to go about buying some shares from British Gas for example......so will these books do or is there something more simple and straight forward I could do?

WilliamO

grey_gym_sock

british gas? do you mean Centrica plc (which trades as british gas), or BG plc (which doesn't, but that's where it gets the letters BG from)?

Linton

If you want the basics of how its done.....

1) Set up an account with an online share dealing service
2) Use your debit card to transfer some cash into the account
3) Use the service facilities to buy your shares
4) Once the shares have increased in value, sell the shares through the online service
5) Transfer the profits back to your bank account.

There are many online dealers. Halifax is one.

pvt

You might try Hargreaves Lansdown, they have a very good name and competitive rates.

I use Barclays Stockbrokers, they seem to be a very decent and honest bunch

gkerr4

WilliamO wrote: »

Thanks for the advice and recommendations. Just want to clarify:

All I want to do is know how to go about buying some shares from British Gas for example......so will these books do or is there something more simple and straight forward I could do?

WilliamO

you buy shares on the market - the LSE (london stock exchange) in the case of centrica - you cannot buy shares 'from' the company - so yes, you do need a broker.

it doesn't matter where you are, as you will almost certainly buy from an online or phone broker - there are many https://www.iii.co.uk https://www.shareprice.co.uk to name two - but there are lots more out there.

to be honest, and please don't take this the wrong way, but from the questions you have asked, you really need to understand a lot more of the basics before you consider investing / trading.

I, also, would recommend the "Naked Trader" book as an excellent introduction to the game.

TDPIX

WilliamO wrote: »

Thanks for the advice and recommendations. Just want to clarify:

All I want to do is know how to go about buying some shares from British Gas for example......so will these books do or is there something more simple and straight forward I could do?

WilliamO

Depends on the company you go for. If you decide to go with X-O:

1) Go to http://www.x-o.co.uk/register.htm

2) Apply for a nominee account

3) Fill in the information

4) Once your account has been setup, login and fund your account via your debit card

5) Once funded, buy shares in your chosen company

X-O's fees are £5.95 per trade. There's then 0.5% stamp duty tax.

WilliamO

Hi All,

Thank you all for the great advice. I will get the Naked Trader from amazon later. I like the idea of what TDPIX was pointing out.....it runs along the lines of what I was hoping for......simply join/register with an entity online, top-up the account and then buy the shares I like.

So after I have read the Naked Trader and gone to the places mentioned in this thread; one question remains: How do I pay the 0.5% tax? I am self-employed so does it get declared as a private matter (i.e. profits and therefore taxation on a private investment) or as an earning (profit and taxation) as part of my self-employment? In other words, do I declare the shares as part of my self-employment or what?!! Clarification on this would be great and appreciated.

WilliamO