How best to invest

ro2778

I'd like to start regularly investing and I have some questions for those with more experience than me. Im 31 now so for the first decade I plan to make higher risk investments, I was thinking about dividend paying shares. I will start by investing £700 a month for the first year.

My questions are, should I do this within an ISA? It is less risky to diversify from the outset, so then I will incur a trading fee for each company, but if I plan to invest in 15+ companies, each month, what is the best trading platform for me to use?

My investment strategy for the next 10 years is high risk capital growth. Are there other investment products that would also be worth considering? I already have a mortgage on a flat and I'll probably buy some more property later in life as I seek to take out risk from my portfolio.

xylophone

You might prefer to open an ISA account with a broker/platform and use Acc units in funds for your first foray into investing?

Do your research first.

http://monevator.com/review-smarter-investing-by-tim-hale/

http://monevator.com/compare-uk-cheapest-online-brokers/

http://monevator.com/category/investing/

Drp8713

15 plus companies per month with £700, there is no point, even paying £1.50 per share dealing fees would make your initial charges over 3% plus an extra 0.5% for stamp duty.

I have been there, I started investing like that as a hobby and did enjoy researching shares and Investment Trusts and holding them.

But realistically, if your aim is to make money then open ended funds is the way to go if your using a platform as trading is usually free, annual platform % fees will be cheap until your pot grows to a decent size and you can get diversified easily with just a few funds.

If you think a concentrated portfolio is the way to go, you can look at people like Nick Train and let them do the hard work for you until you build up enough to make worthwhile picking your own.

george4064

Have you considered regular savings into investment trusts?

They are generally higher risk/higher return than funds, but they are cheaper than funds and offer better diversification than regulAr savings into lots of individual shares. Many investment trusts pay dividends, which you reinvest back into the trust or buy more shares and thus create a compounding effect (this works similar to accumulation units of funds, but much better in my opinion).

Let me know if you have any questions on investment trusts and I'll answer them as best I can

dunstonh

How best to invest

There is no best as investing is about opinion. However, there is plenty to get wrong. The best option for you will probably not be the one that makes the most money in a given period.

I plan to make higher risk investments, I was thinking about dividend paying shares. I will start by investing £700 a month for the first year.

How are the dealing costs going to stack up on a monthly contribution compared to funds?

My questions are, should I do this within an ISA?

Why wouldnt you? Apart from pension, its usually the most tax efficient wrapper.

but if I plan to invest in 15+ companies, each month, what is the best trading platform for me to use?

So, dealing costs are going to hit you hard then. Have you costed it against funds?

What knowledge do you have and what research will you be doing to decide what shares you should be buying?

ro2778

george4064: That's really interesting I've never heard of investment trusts. So assuming I find a trust I like what's the cheapest way to invest regularly in a trust?

Dunstonh: I appreciate I'm not a big enough investor to go for shares since I started this thread. The idea of funds appeals but the fees don't. Perhaps trusts are a good compromise? My research will be specific to the investment product but I also have favourite industries so I'm not totally profit driven as I'm not relying on this for my retirement this is just a bit of fun and if it works out then even better.,I have experience of investing in shares and funds but not trusts.

george4064

ro2778 wrote: »

george4064: That's really interesting I've never heard of investment trusts. So assuming I find a trust I like what's the cheapest way to invest regularly in a trust?

Dunstonh: I appreciate I'm not a big enough investor to go for shares since I started this thread. The idea of funds appeals but the fees don't. Perhaps trusts are a good compromise? My research will be specific to the investment product but I also have favourite industries so I'm not totally profit driven as I'm not relying on this for my retirement this is just a bit of fun and if it works out then even better.,I have experience of investing in shares and funds but not trusts.

You should read more about investment trusts to get a better understanding before investing, here's a few articles with some good info:

http://www.which.co.uk/money/savings-and-investments/guides/different-types-of-investment/what-are-investment-trusts/

http://am.jpmorgan.co.uk/investment-trusts/explained/what-is-an-investment-trust.aspx

You should read the fact sheet of an investment (whether it's a unit trust or investment trust) before investing, this will detail the charges, performance, top holdings and its aim. Please remember to consider the platforms charges too.

Investment trusts are widely available at investment platforms, I'd recommend utilising your stocks & shares ISA to hold your investments. Regular monthly investing into investment trusts usually cost £1.50 per transaction.

Thrugelmir

ro2778 wrote: »

I already have a mortgage on a flat and I'll probably buy some more property later in life as I seek to take out risk from my portfolio.

Higher exposure to residential property will increase risk rather than decrease it.

ro2778

That depends what you were doing before, risk is relative.

Pincher

Find a website that lets you set up a Virtual Portfolio, and start trading ASAP.

The reverses in the last two months is truly spectacular.
Barak Obama doing a nuclear deal with Iran will plunge oil prices even lower. The shale producers would probably assassinate him yesterday if he wasn't leaving office soon anyway.

BRIC countries are crumbling like rampant rising damp. Roubles is tanking, Brazil is now junk bond, China is collapsing, and India sounds pretty bad too.

To stop the mother in law from visiting, we now have to go to Syria to fix their roof, so she has no excuse to turn up in Europe. That means war stock should go up.

I should buy shares in drone manufacturers, if I could work out who makes them. Since infiltrate and kill UK citizens in ISIS is now legal, I look forward to T-800 (Arnold in Terminator) prototypes.
Not sure if we will get dividends before the world is taken over, so probably best to profit take in 2016, then time travel back to 1984.

If you can trade your way (virtually) successfully through this chaos, then you are a hedge fund manager, my son.
-- Rudyard Neil Woodford Kipling.

cloud_dog

Ro.... I would suggest selecting 1 / 2 / 3 good general investment vehicles (ITs, UTs, OIECs, ETFs).

Depending on what you want to invest in you could (if you go with 3 different funds for example) focus on three different geographies.

It would make sense to invest within an ISA wrapper because a) why wouldn't you (as Dunston says), b) You will quickly find yourself (hopefully) where capital gains may be a consideration.

Select one (or more) good general investment funds build up a holding and you can always re-balance / diversify / specialise once you have a reasonable amount invested.