What to think when buying shares.

Catseye_2

I have inherited a box of shares including mmO2. So far I have found that mmO2 became O2 before being bought out by Telefonica SA! Does this mean I now have shares in Telefonica SA or just a worthless bit of paper?

allan2006

What shares are people buying at the minute, any tips people

tradetime

allan2006 wrote: »

What shares are people buying at the minute, any tips people

Yes, ignore "share tips" from people you don't know, many of them are scams, of the ones that are not outright scams most will tip shares they own, and therefore their views are at best biased, at worst an attempt to manipulate via pump and dump., best tip I can give you, if you want to buy individual shares, do the legwork yourself and generate your own tips.

bowlingo

Hi all,

Im thinking about £5000 worth of Lloyds TSB shares.. I am new to the share game and was wondering the best and cheapest way of going about buying them?

Thanks
Alex

sabretoothtigger

I love the randomness of that, any reason or just like the name?
Actually the TSB got dropped, its just Lloyds Banking Group plc now since they own half the country

I always say to people randomly buying you should split it up 12 ways or more, your chance of getting a good average price is much better.
If you setup an account with iii they would charge you £ 1.50x12 = 18 in commission or if 5k is your monthly income and you spent it in one go then they charge £10 plus you pay 0.5% in duty


http://www.lloydsbankinggroup.com/


Compared to doing no reading then share tips from all the broadsheet newspapers is not that bad, just dont buy immediately but the background info is reasonable enough

adamd1 wrote: »

I am new to investing. If I buy a share before its xd date, I pay stamp duty and a dealing cost. I collect the dividend, and the share drops by that amount, but usually picks up in a day or two. I sell the share having owned it for only a few days, collect the dividend and incur a cost (spread, stamp duty, dealing fee). This should still give me a few % on each transaction. Why could I not do this every week? In an ISA - tax free.

I haave not seen this discussed as a strategy, and there must be good reason for it. Advice from wiser heads wold be appreciated.

That can work in a rising market and thats your gamble. Tate did it, BNC did it, hyder, SL did it for one day last week and probably others. Thing is it probably would have risen that much plus the dividend % anyway since the dividend cash while unpaid belongs to the owners of the shares anyway.

SL for example has enough cash to pay out twice their dividend amount if they like so the share price until that happens reflects the cash surplus.
Its not always true, there are bargains sometimes but usually the market estimates the price correctly for that moment in time and you have to guess the future.

Tate was cheap due to losing a patent case plus the market was depressed but rising especially commoditys and indias sugar crop failed, how could you estimate all that and say the dividend is 'free'. You couldnt but you can guess

sabretoothtigger

bowlingo wrote: »

Hi all,

Im thinking about £5000 worth of Lloyds TSB shares.. I am new to the share game and was wondering the best and cheapest way of going about buying them?

Thanks
Alex

bowlingo pm'd me and Im no expert so for the sake of safety in numbers in case Im wrong I'll post what I replied roughly here

Over the last month lloyds is the largest fastest rising company quoted. If its already done that then you are most likely late to the party and will probably just end up with the bill

I dont know thats the case but its certainly the most likely scenario from here



lloyds have quadrupled their shares in issue. So thats like comparing the price of a cake to one cut into four pieces, its not such a bargain. The real price right now is about £4 and the last time lloyds were £4 was May 08 when we werent in recession. So we can see they are rated quite highly

Unless a company takes on shareholders money to invest sucessfully, I dont think it can be considered a gain of any sort.

If its just for paying off bad debts then we are talking about a division of previous worth in that share hence why the price falls and is right to do so.
I think thats how it works


Barclays rose back so much because they didnt issue as many shares, its as simple as that.
RBS issued absolutely tons, like quintuple the amount and thats not a word you hear every day even on the markets. These guys really messed up



Heres where you check Shares in issue for Lloyds -
1st Jan 2009 - 5,742 shares
16th August 2009 - Shares Issued 27,162m



http://www.iii.co.uk/investment/detail?code=cotn:LLOY.L&display=fundamentals&it=

marvin

wallaceneil wrote: »

I am already saving with my company share saving scheme and have been offered another annual opportunity to start another 5 year share option scheme. Due to the current financial climate and the growing uncertantity in the stock market would I be better advised to put my money in a 5 year savings account, or take a chance on the stock market recovering over the next 5 years. Yor advice would be welcome.

Neil

This really depends on what company (is it secure?) at what price (is it at a discount to the market value by a date?) is this a price likely to be beaten over time (IE are the share currently at a high price and are they likely to drop more than the discounted price by the time you cash in your share save scheme.

Does your company offer any other investment vehicles other than share save?

Right now some examples I work for Sainsbury's every year they offer a share save scheme which is offerd at a discount of 20% to the share price on a given date. Lets us suppose the share price on that date is £3.10 per share. This would give a share option price of £2.48.

So is this a good price? Well look at the lowest price the share has been at in the last 5 years. If the lowest has never beaten (IE if the lowest its been is not lower than the offer price) the offer price it is unlikely to (not impossible but unlikely) so you should gain.

Sainsbury also offer a share purchase scheme which is a way of buying and owning shares no not later. This often comes with a similar discount to the share save scheme. The current offer from SSPP is buy 4 get one free with no dealing costs and the payment being taken off the salary tax free.

The other difference is you own the shares so you will also get any dividends payable on the shares.

With the SSPP I have bought about 500 shares in the last year (there is a £115 limit per month stipulated by the tax man) .

Hope some of this is helpful

macdo

Hi I have been looking through the site trying to ask / find an answer to the question:
Is there such a creature as follows?
A person who uses your money, guarantees the sum to remain intact, share deals (or whatever) And when they make money takes a share.
So they'd be rewarded for profits made NOT as I see stock brokers now, you pay them whether they make or lose you money, so you are suspicious of their advice as they seem different from other professionals.
Am I just hideously naive?

sabretoothtigger

yes probably

Reaper

macdo wrote: »

A person who uses your money, guarantees the sum to remain intact, share deals (or whatever) And when they make money takes a share.

The closest would be a GEB (Guaranteed Equity Bond). They offer a guarantee not to lose your money and give you most of the growth.

However many have a poor opinion of them. There is lots of small print such as the guarantee not applying if the stock market falls too much, not paying out dividends, "averaging out" growth in the final year (means you get less) and so on.