First Time Share Buyer

enthusiasticsaver

If you are new to investing I would suggest you look at funds rather than individual company shares which are very risky. I started off investing at the beginning of this year but spent a few weeks reading threads on this site, monevator articles and research on funds on trustnet etc. The moneywise newsletter is also good. The advice usually is spread your money around geographically and sector wise. The only way you can realistically do that with a small amount (which £500 is relatively speaking) is to invest in a fund.


The first things you need to decide are your level of risk (how much would you be comfortable losing before panicking and selling) and the timeframe you are investing in. As you have other savings in cash isas I am assuming you are talking medium to long term? I used the compare my platform website when starting out and opted for Cavendish which is one of the cheaper options for smaller portfolios.

Eco_Miser

Michael1010 wrote: »

I understand Rolls Royce is a safe bet for long term shares?

Funny you should pick that company. The original Rolls Royce failed so badly it was nationalised by a Conservative government. https://en.wikipedia.org/wiki/Rolls-Royce_Holdings#Nationalisation_and_separation

While the current company may be OK as part of a diversified portfolio, the original company illustrates the dangers of relying on a single shareholding.

Apodemus

Michael1010 wrote: »

Is investment in a single company riskier?

Yes!

If you don't like the idea of putting your single egg in a single basket then you need to consider something else.

Personally at your stage I was happy with that level of risk, knowing that in time another egg would come along that I could put in another basket.

But you also have to take the time to study the company that you are interested in if you want to reduce the risk or at least understand it.

HHarry

Just be aware that the trading costs when investing small amounts make it more difficult to turn a profit.

As an example - £500 will buy around 50 RR shares. HL will charge £11.95 to buy, and then the same to sell (I think X-O might be cheaper). So you need each share to rise by 50p, or 5%, just to cover the costs. That's not impossible, but it's worth bearing in mind.

Michael1010

Thanks for all the great replies...Alot to take in & improve my knowledge
Will definitely start with the suggested reading

Thanks