What/Where to invest?

Touser

Hi,

I have £5000 to invest but I'm not sure what product(s) are best to invest in. I have already used my £3000 allowance for my ISA for this financial year.

I have been looking at the 'Index-linked Savings Certificates' product from NS&I which sounds like a good product to invest in and the 'Guaranteed Equity Bonds' which are linked to the stock market growth, although I wasn't sure if this was a good investment with the FTSE value coming down recently. I think the last Issue of National Savings and Investments Guaranteed Equity Bonds may have passed now anyway, but if any one can advise if these are worth investing in for the next issue.

I have been keeping this money in an online saver with HSBC but wondered if there was a better way to invest it.

Thanks.

amcluesent

>there was a better way to invest it.<

There are riskier ways to invest, with the potential for a higher return than saving with HSBC. If you can afford to lose your money, then try -

India funds
Alternative energy funds
Oil funds
Gold bullion

dunstonh

I have £5000 to invest but I'm not sure what product(s) are best to invest in. I have already used my £3000 allowance for my ISA for this financial year.

The ISA allowance is £7000 for this year. Not £3000. Only the savings element, the Cash ISA, is £3000. You still have £4000 left for the investment element, the Stocks and Shares ISA.

and the 'Guaranteed Equity Bonds' which are linked to the stock market growth, although I wasn't sure if this was a good investment with the FTSE value coming down recently

The FTSE value hasnt come down recently. That said, GEBs are rubbish products and you wouldnt want to be in one of those.

As you want to invest, you should look to use up the last £4000 in the ISA and the remaining £1k should go into unit trust. What you use will depend on your attitude to risk. There are 2000 unit trust funds covering the range from very low risk to very high risk. You can mix and match to suit your risk.

SeanW

The Index linked savings certificates are not too bad, especially if you are a higher rate tax payer. They are probably no good if you don't pay tax though.

The guaranteed equity bonds are not so good, although there is some potential for growth, there is also potential for no growth.

There are riskier but potentially more possibility of growth options, such as investment funds or investment trusts, or stocks and shares etc.

If you can put the money away for 5-10+ years, and can tolerate some rick, unit trusts in a mini S&S ISA may be a good idea. Rather than go straight in to India, Alternative Energy etc. if you don't want high risk, how about UK equity income funds with either accumulation units or income reinvested for growth.

moneyandmountains

SeanW wrote: »

Rather than go straight in to India, Alternative Energy etc. if you don't want high risk, how about UK equity income funds with either accumulation units or income reinvested for growth.

I would echo SeanW's comment.
It would be particularly foolhardy to jump from no investments to v.high risk investments. Even the people with high risk investments probably didn't start off that way.

dunstonh

There are riskier ways to invest, with the potential for a higher return than saving with HSBC. If you can afford to lose your money, then try -

India funds
Alternative energy funds

Crikey. Talk about telling someone to jump in at the deep end with concrete boots on.

Even the people with high risk investments probably didn't start off that way.

And they wouldnt be heavy in those areas either. They are niche areas which make a small part of the portfolio. Not the core of it.

amcluesent

>Crikey<

My bad, but I did say only if you could afford the loss...:o

But with no other info from the OP, it was some darts thrown onto the investment board...but I do think India and Alternative Energy are attractive on a 5-10 year basis.

moneyandmountains

Since the OP is probably confused by now, I will ask the obligatory questions.

What is your attitude to risk for this £5000?
i.e.
would you be worried in a particular year, if it was down
10%
20%
30%

What is the time scale of the investment?
i.e. when may you want your money back
1 year
1-3 years
3-5 years
5+ years

Do you have any other stock market investments?

raemon

i am in a similer situation, thinking bout investing 1thosand (not much...) thanks for the info people.

Touser

moneyandmountains wrote: »

Since the OP is probably confused by now, I will ask the obligatory questions.

What is your attitude to risk for this £5000?
i.e.
would you be worried in a particular year, if it was down
10%
20%
30%

What is the time scale of the investment?
i.e. when may you want your money back
1 year
1-3 years
3-5 years
5+ years

Do you have any other stock market investments?

I don't currently have any other stock market investments (I don't have sufficient experience of how the stock market works etc.) this is why I have no idea how to utilise the shares allocation of my ISA allowance (4000 GBP), as I'm not sure how to choose what to invest in. With the cash ISA element its seems a lot easier as you just deposit money and get a return in line with the interest offered.

To answer your questions -

I would be worried in a particular year, if it was down
20%

The time scale of the investment? i.e. when may you want your money back
would be 5 years.

Thanks.

lisyloo

There is a thread on the ISA board that you might want to read.
I read it earlier.

I am thinking on using Hargreaves & Lansdown.
They are a fund supermarket so there is loads of choice and they rebate a lot of the charge.

They are have some "multi-fund" funds so if you are lazy like me and don't want to constantly manage it then you leave it to them.

I would recommend reading the thread.