investment account needed

dingle_3

i want to open up an investment account - just depositing £70 every month - can anyone point me in the direction of a good one please??
money will stay there for approx 10+ years.

Reaper

Typically "investing" means putting money in the stock market. Is that what you meant? Or did you mean "saving" it in a building society account?

If you meant saving then a cash-ISA is your best bet (if you are a tax payer). Have a look at https://www.moneysupermarket.com to see who is currently paying the best rates.

If your meant investment then a stocks-and-shares ISA is a possibiity to make sure the profits come out tax-free, but in practice if you don't use up your CGT allowance it makes little difference. Where is best depends on how much risk you are willing to take in return for potentially higher returns.

dingle_3

this is money to definitley 'invest' - would like medium to high risk - if it all went wrong, it wouldn't matter terribly if the money was lost (although i very much hope this is NOT the case)

thanks for the reply though - do you have any further advice?

Reaper

Sorry - so used to people saying Invest when they meant Save I thought I'd better double check.

Here are a few suggestions.

If you are looking towards higher (but not reckless) risk then the Fidelity Special Situations fund has done me very well over many years. I looks for overlooked, undervalued stocks to invest in. These tend to be smaller companies. It is run by the highly respected Anthony Bolton.

On the negative side the fund has now grown very large due to its success so it is less nimble these days. Performance recently has been pretty ordinary following many years of great returns. Even so I'd still recommend it. In fact I have money in it. Alternatively there are small funds in the same sector which have been posting better returns. They lack the long term track record of the Fidelity fund though.

Another alternative is a tracker fund. The advantage here is the low charges which would otherwise mount up over 10 years. There is little to chose between all the different trackers on offer, so I'd say go for the one with the least charges.

I'm sure others can suggest more opportunities. I haven't been looking recently so I hesitate to suggest any others.

To invest you could go through a funds supermarket such as Fidelity or Egg. These normally discount some of the charges and let you split even a small regular premium over a wide range of funds. If you are going for higher risk investments that is a good idea. Investing in 3 different risky sectors is a whole lot safer than just investing in 1.

I'd suggest you wrap it up in an ISA too unless there is any reason not too. That will make sure you don't pay any tax when you eventually surrender it plus you don't have the hassle of including it on your tax return.

Finally since 10 years is a long time I'd suggest you check every couple of years on the performance. A good sector today may be a bad one in 5 years time. Fortunately the fund supermarkets will let you make low cost switches between funds if you feel like a change.

O yes - from memory I think Egg might have a minimum investment of £100 a month, can't remember about the others.

Robert_Sterling_3

It is not surprising that the man in the street or on the Clapham omnibus uses the word "invest" to mean "to buy stocks and shares" or "to deposit money in a bank or building society" as these are the first two of several meanings attributed to "invest" in leading and respected dictionaries.

Those who have acquired the jargon of the trade use invest on the whole to mean buy stocks or shares whereas savings is used by them to describe safer investments i.e in Building Societies ( other than the Grays Building Society I guess ).

Robert_Sterling_3

Duplicate message deleted.

Darryl

My advice?

First learn about investment via sites such as http://www.fool.co.uk/

Second, never invest based upon tips/ideas given by others, friends, newspaper articles, etc.

Decide why you want to invest (Fidelity have a good portfolio planner to help you define what you want out of your investment, and gives ideas for how to acheive your goals http://www.fidelity.co.uk/direct/planning/portfolioplanner/index.html)

Invest via the cheapest means possible. Discount brokers such as Fidelty, http://www.hargreaveslansdown.co.uk/ and others offer funds and share investments at lower rates than direct fund investment/traditional brokers.

Finally, avoid IFAs.

Hope this helps

Darryl.

dingle_3

i've never invested before and after my initial searches on internet quite frankly i felt baffled.

therefore, thanks to everyone for your replies... you have all given me some great pointers - i'll do abit further research and come back with any further queries if i have them.
;D

dunstonh

Finally, avoid IFAs.

So what you suggest is that someone relies on advice posted by an unknown person which is potentially illegal rather than a professional who is accountable for the recommendations made for the sake of saving around £25 a year.

Dingle, you are better off avoiding people that make unqualified statements rather than IFAs.

Darryl

No DD, all I say is avoid IFAs and do your own research. Compare the performance of companies, funds, etc and read the news to see how the world or industries are changing/evolving.

In my experience of IFAs, they do no more than that as the basis of their advice to me. And, if one looks at what you need to study/pass to become a 'professional' IFA, they'd soon realise that they could quite easily gain the neccessary qualifications to become their own adviser.

Darryl.

dunstonh

You obviously havent experienced the right IFA then.

There are loads out there which treat each transaction as a one off. There are others which provide an ongoing service with regular reviews and reporting.

Many people dont need regular reviews and a one off is fine but there are those that do. It is a case of finding an IFA that suits you, if you want the service.

If you want to do it yourself, then fine. If you can spend the time and feel that the time spent doing it yourself is good value for money, then good for you and good luck.

And, if one looks at what you need to study/pass to become a 'professional' IFA, they'd soon realise that they could quite easily gain the neccessary qualifications to become their own adviser.

Do you mean pass the exams or learn the job? They are two different things and that applies to any qualification.