£200 high risk investment

studentinvestor

I'm sure people are bored of answering this type of question but as I am pushed for time to traul through previous threads I am looking for a concise response. I recently received £200 pounds through matured NS&I childrens bonus bonds and am looking to buy some shares with them. The risk level doesn't really bother me and I am looking for the investment to make potentialy good gains over a period of a 5 years +. I have looked at the article written by martin on the cheapest way to buy/sell shares which interests me greatly, however what doesn't interest me is paying for the privelage. There must be some way of going directly to companies and buying shares straight from them? You can probably telll I'm inexperienced and have little knowledge (only what I have read so far). Any help would be appreciated.

wombat42_2

You get big charge discounts using Hargreaves and Landsdowne. The two areas which are hi risk but hi potential are China and Commodities as discussed in other threads. But £200 hardly seems worth bothering about - orginally when I read your post I thought you meant 200K. Maybe stick it in a UK index tracker.

Aegis

I don't know how many funds you'd be able to get in to with only £200, so those might be a bit of a write off from the very beginning. Even the cheapest way to buy and sell shares as and when you want to will cost £12.50 per transaction (i.e. £25 total once you've bought and sold), which leaves you with one of the fixed-date purchasing schemes as a viable option. I think that the Motley Fool's website (www.fool.co.uk) has a portfolio builder where you can buy shares for £1.50 per transaction, but you have no control over the exact time you'll buy at.

All in all, with £200 I'd personally think it would be more economical to just let it sit in a good savings account until you have enough to make such purchases worthwhile, at which point you could consider researching more thoroughly and deciding on a course of action for yourself.

Throwing money away into the stockmarket (the likely result if you take into account inexperience, bad charge:capital ratio and current volatility) probably won't teach you anything about trading at this stage.

cheerfulcat

studentinvestor wrote: »

I'm sure people are bored of answering this type of question but as I am pushed for time to traul through previous threads I am looking for a concise response.

Hmmm.

I have looked at the article written by martin on the cheapest way to buy/sell shares which interests me greatly, however what doesn't interest me is paying for the privelage. There must be some way of going directly to companies and buying shares straight from them?

If you mean shares and not funds, then no, you must go to the market for them. But in any case, as others have said, it's too small a sum to invest. Keep it in the bank.

isofa

It's such a small amount to dabble on the stockmarket with, perhaps you can just pick some shares you fancy (one company, as you don't have enough to spread your cash), and just buy £200 of shares.

Someone will be about to recommend a good on-line share-dealing service I'm sure!

Aegis

isofa wrote: »

It's such a small amount to dabble on the stockmarket with, perhaps you can just pick some shares you fancy (one company, as you don't have enough to spread your cash), and just buy £200 of shares.

Someone will be about to recommend a good on-line share-dealing service I'm sure!

The trouble is that the trading costs are going to be a significantly higher percentage of his capital than he's likely to earn in a year. £14 represents over 5% of his total investment... Would be better waiting for more capital to get some economy of size going on with his investment.

If you ask me anyway.

Still, you never know, maybe a penny share investment would take off and make a fortune (seriously, OP, this is a bad idea unless you know what you're doing!)

studentinvestor

thanks for the replies. I thought that it was too little money to make any real investment, but at the same time thought there may be some kind of high risk investment/ share buying option that could potentialy make a good % on my investment. Not quite placing all my money on the dogs and hoping for the best but a more calculated risk that involves a degree of fortune. What are these penny shares they speak of?

MABLE

Well by the fact the any share that is in the penny class is there for a very good reason. I remember a company called Posiedon which was an Australian gold mining share that you could buy the shares for about 1p and overnight they struck gold and are worth £100 each. With any penny share it is a gamble and you must be prepared to lose all your investment. Myself I would stay clear of investing for now and put the money in a high interest rate savings account. Very boring but it is safe for a rainy day.

cheerfulcat

Penny shares are shares in ( usually ) small companies. They are so called because they ( usually ) trade under £1/share. They tend to be very illiquid and can have very wide buy/sell spreads. Here are two examples of what can happen to penny shares -

SYM
GKP

More info here.

[Deleted User]

This is the siliest thread ive read in a while £200 high risk investment. You aint gonna do much investing with 200 quids worth of anything.

Unless you won the lottery on a penny share but i think youd have better chance of winning if you bought 200 quid of lottery tickets.

pamaris

Why don't you stick it in the Fidelity Moneybuilder All share index fund, choose the monthly savings plan and add £50 a month to it?