Why does anyone buy individual shares?

[Deleted User]

Linton wrote: »

If you are buying individual shares I suggest you do it in at least £2K amounts so that charges are fairly irrelevent and any gains are worth the effort in £ terms. Also you should be holding at least, say 15 individual shares so that you arent hit too badly if one were to go bust. So that amounts to a pot of at least £30K before you start to play with individual shares, in addition to the money you invest in foreign funds. You dont want the UK as a major part of your portfolio.


To successfully manage a portfolio containing a large number of individual funds requires that you spend significant time understanding the financial progress of each of your holdings.


Is it worth the effort?

I agree although £30k would make up too much of my portfolio.

Ideally I would like to buy 10 or so shares at £200 each. But £20 trading costs for each one is 10% which is too much. If I had a million pound portfolio then I could do £2000 in each share and then the £20 trading costs per share would be acceptable to me.

kinger101

newbinvestor wrote: »

I agree although £30k would make up too much of my portfolio.

Ideally I would like to buy 10 or so shares at £200 each. But £20 trading costs for each one is 10% which is too much. If I had a million pound portfolio then I could do £2000 in each share and then the £20 trading costs per share would be acceptable to me.

If you've only got £2K, then investing in shares is bonkers, particularly at £200 x 10. As you've already found out. Stick to ONE low-cost tracker. Something like Fidelity Index World.

Apodemus

newbinvestor wrote: »

I agree although £30k would make up too much of my portfolio.

Ideally I would like to buy 10 or so shares at £200 each. But £20 trading costs for each one is 10% which is too much. If I had a million pound portfolio then I could do £2000 in each share and then the £20 trading costs per share would be acceptable to me.

If you’ve only got one egg, you can only keep it in one basket, so you need a secure basket.

enthusiasticsaver

Ethical reasons maybe? Some may not wish to invest in tobacco companies or companies which practise tax avoidance or poor ethics. Although surely buying in an ethical fund would produce the same results.

Personally I don't buy individual shares because I don't have the expertise or wish to spend many hours researching and keeping on top of individual companies and their company practices/results.

[Deleted User]

kinger101 wrote: »

If you've only got £2K, then investing in shares is bonkers, particularly at £200 x 10. As you've already found out. Stick to ONE low-cost tracker. Something like Fidelity Index World.

Most of my funds are trackers. I would like to invest in individual shares as a sort of fun gamble but the £10 dealing charges make it silly.

LobsterMemory

enthusiasticsaver wrote: »

Personally I don't buy individual shares because I don't have the expertise or wish to spend many hours researching and keeping on top of individual companies and their company practices/results.

Reckon it would take about an hour to knock out a perfectly feasible portfolio

Oh look, here's one I prepared earlier

https://uk.advfn.com/cmn/fbb/thread.php3?id=9227087

CAUTION: Contains sweary words from the first line if you count '!!!!' as a swearword

Thrugelmir

BLB53 wrote: »

I could not sleep easily at night knowing I invested in these large fossil fuel companies!

Without differing opinions there'd be no markets to trade in.

talexuser

My only ever single share was because of the single company PEP many years ago where you could invest in a single company as well as the 6K you could put in your tax free fund PEP.

Before the internet we only had the financial pages of the quality papers who all said that Glaxo was a good steady investment. I put in the max single PEP of 3 grand, after a few years they merged with Wellcome and then PEPs were replaced by ISAs. The high charges of the single PEP, unloved by platform providers as uneconomic, and the merger which often loses shareholder value, meant that after 5 years or so I more or less had my 3 grand back after dividend re-investment.

Meanwhile my funds in Jupiter Income and Perpetual High Income (don't say the name Woodford) had easily more than doubled.

DairyQueen

John_Smith_2019 wrote: »

That depends on your perspective.
If you owned that share within a fund or IT, you would still have gained 100% on that share of the fund.

The 100% gain was luck. The 0% loss demonstrated exactly how bad I am at stock-picking. I am not equipped to outperform markets so better to simply track major indexes with a few satellite funds to fill-in any gaps.

[Deleted User]

Glaxo is a prime example of a share whose price never goes anywhere but keeps paying a healthy dividend. It has its place but plainly isn't a stock in which to invest for stellar performance.

An example of a growth stock would be Aapl. It's share price was about the same seven years ago but, since then, they have diluted shareholding by a factor seven so, if you follow my rough calculation, the value of their shares has multiplied by seven in the interim. It really was not that difficult to find; it is the most most heavily traded stock in the world.