What to do with £5k?

MadeToFit_2

Hi,
I've got about £5k saved, but I'm not sure what the best thing to do with it is.

It was in shares of AIM listed companies, and I've done very well out of them (and been more than just a bit lucky). But they posted disappointing results so I lost my nerve and bailed.

So now I need to think of something to do with it! (And don't say spend it!)

Obviously, cash is bad as it's literally losing money. The pitiful interest rates offered on cash ISAs make them not much better.

Then I got round to thinking about shares in FTSE 100 companies. Tesco looks like a good buy at the moment; even if they don't go up much they still pay a good dividend. I think Vodafone is over-valued and the price is pumped because of the generous dividends they pay. I'd steer clear of anything financial because that's a bit of a risky industry at the moment, and BP is risky while the Gulf of Mexico business is ongoing.

I guess my main criteria are: the share price won't plummet and some dividend would be nice.

However, then I read about trusts and trackers. For a relatively low investment such as this, these seem like a good way to spread risk over multiple equities. I've been looking at TrustNet but have just ended up confused -- how do you choose one! Frankly, random seems as good an algorithm as anything: I can't see any obvious correlation of performance with any of the many metrics that excellent website tabulates.

So that's where I've got to.
Does any of it make sense? Or is it all complete madness?
Any other ideas I should be looking at?
Ta.

cashbackproblems

It sounds like you want to invest it and without the stress of AIM exploration companies! I would recommend opening a HL account and you can spread it over 1/2 emerging market funds, or a high yield bond paying 7% interest.

Or a ftse company, ones i hold and rate include aviva, barclays (definite upside regardless of low divi currently), RSA and Tesco. I also hold vod but dont see lots of growth just a very good dividend.

You can hold all the above in a S+S ISA dont forget.

jimjames

For a tracker there are pretty much only 2 choices. Which market and once chosen then which is cheapest tracker for that market? The only differentiation between trackers for the same market is cost and there is no point paying higher charges than you need for the same performance - which is what you get with a tracker.

gadgetmind

MadeToFit wrote: »

I'd steer clear of anything financial because that's a bit of a risky industry at the moment

Maybe, but financials (ordinaries and debt), commercial property, and European equities have been my best performers during 2012.

Why?

Because no-one else wanted much to do with any of them.

Anyway, you probably want to stick to collective investments as £5k isn't enough for you to get good diversity. However, you don't mention age or goals so it's hard to know what to suggest TBH.

Arnold_Armstrong

MadeToFit wrote: »

Hi,
I've got about £5k saved, but I'm not sure what the best thing to do with it is.

It was in shares of AIM listed companies, and I've done very well out of them (and been more than just a bit lucky). But they posted disappointing results so I lost my nerve and bailed.

So now I need to think of something to do with it! (And don't say spend it!)

Obviously, cash is bad as it's literally losing money. The pitiful interest rates offered on cash ISAs make them not much better.

Then I got round to thinking about shares in FTSE 100 companies. Tesco looks like a good buy at the moment; even if they don't go up much they still pay a good dividend. I think Vodafone is over-valued and the price is pumped because of the generous dividends they pay. I'd steer clear of anything financial because that's a bit of a risky industry at the moment, and BP is risky while the Gulf of Mexico business is ongoing.

I guess my main criteria are: the share price won't plummet and some dividend would be nice.

However, then I read about trusts and trackers. For a relatively low investment such as this, these seem like a good way to spread risk over multiple equities. I've been looking at TrustNet but have just ended up confused -- how do you choose one! Frankly, random seems as good an algorithm as anything: I can't see any obvious correlation of performance with any of the many metrics that excellent website tabulates.

So that's where I've got to.
Does any of it make sense? Or is it all complete madness?
Any other ideas I should be looking at?
Ta.

Invest in property buying or you can start your own business so that you can profit from the money you saved...

Nicholas-bloody-Parsons

I doubt you need advice if you are sophisticated enough to manage to trade AIM listed shares.

:T