£10,000 to invest In shares for dividend income

JeffG

Hello, I wonder if you could give me some sound advice? I have £10,000 to invest in shares, hopefully to produce an income from dividends. I'm not a tax payer. I'm thinking of investing in blue-chip shares along the lines of BP etc. Any ideas, or advice would be welcome.

Ifts

Theres this thread here: High yield FTSE 100 stock recommendations?
https://forums.moneysavingexpert.com/discussion/4241793=


You could take a look over on Fool.co.uk -
http://boards.fool.co.uk/high-yield-hyp-practical-51676.aspx for ideas.

Monevator.com is also a good place for info, some great guides here -
http://monevator.com/category/investing/passive-investing-investing/

Linton

The most active HYP (High Yield Portfolio) discussions are on Motley Fool where there are separate Practical and Strategy forums. HYP is a strategy whereby solid FTSE100 dividend paying shares are bought and held for the long term.

If you want to hold shares you need to ensure that you achieve maximum diversification so that if one company or sector falls catastrophically it doesnt have a major affect on your portfolio.

Diversification implies holding a fairly large number of different shares, say >15. You may find that buying 15 different shares with £10K is somewhat expensive - about £1500 is considered to be a minimum holding. However if you are planning to continue putting money into your portfolio you can reasonably build up the number of holdings over time.

I recommend that you hold your portfolio in an S&S ISA. There probably wont be any tax to be saved if you are a standard rate tax payer, at least whilst your portfolio is relatively small, but it does avoid the hassle of keeping records for the tax man.

itch_for_a_glitch

http://www.topyields.nl/Top-dividend-yields-of-FTSE100.php?gclid=CNi_3c3PiKkCFUYPfAod10EKpQ

I hold, Astrazeneca, National Grid, HSBC, BP & United Utilities.

Thrugelmir

With £10k to invest. I would opt for a couple of Investment Trusts (£5k each) that pay dividends quarterly.

Deepwater Horizon is a classic reminder as to what can happen when there's an over reliance on one share.

Hold individual shares once your portfolio is of a far greater value.

planteria

itch_for_a_glitch wrote: »

I hold, Astrazeneca, National Grid, HSBC, BP & United Utilities.

as part of a much larger portfolio, or is that a portfolio in it's own right.

i always see the logic of diversification, and a concentrated portfolio is clearly harder hit if one or more of the companies within it take a hammering. but, the wider the spread, the more you level out your performance too.....i get Warren Buffett when he talks of focusing on your very best ideas too. i would, for example, rather select a spread of 10 FTSE100 companies to hold in a portfolio than invest in a FTSE100 tracker.

C_Mababejive

I would suggest you consider low to med risk funds which have at least 30% investment grade bonds in their structure. I think you will find it painful to invest such a relatively small amount for dividend growth by holding shares directly.

BLB53

With £10k to invest. I would opt for a couple of Investment Trusts (£5k each) that pay dividends quarterly.

Agree. Two or three ITs will provide a decent income - I hold City of London, Murray Income, Temple Bar, Aberdeen Asian Income and Edinburgh.

I also hold a few shares - Unilever, Reckitt, Glaxo, Billiton etc - I am finding that the ITs provide the better overall returns.

blinko

curious question why are you not a tax payer ?

cos_2

blinko wrote: »

curious question why are you not a tax payer ?

Most people in the UK don't pay income tax simply because their income is under the threshold. I'd imagine it's the reason here.

blinko

cos wrote: »

Most people in the UK don't pay income tax simply because their income is under the threshold. I'd imagine it's the reason here.

interesting might they not be better off simply investing in a risk free saving account?

the OP do you have any more info for us?