invest in the FTSE....which stock??

ivegotabig1

well it seems the housong bonanza has finally come to an end, little or no money to be made there !! interest rates a low, & look to be heading lower, so a lot of money seems to heading into stocks !! if you had say 10k to invest, what sectors or stocks would look like a safe bet to you !! or would an index tracker be a safer better option ???..

dunstonh

The UK stockmarket has been outperforming property for 2 years now.

Individual recommendations are not allowed and individual stocks/shares is something not covered here because of the potential minefield.

Index trackers have been poor compared with UK Equity & Income sector for some time now and that is likely to continue. Ignore foolish sites that make out that index trackers are the best thing. Boom/bust & consolidation periods absolutely. However, the FTSE100 has been through all that. The 250 is still fair game for consolidations and that has good potential. With a market not really going up fast, the dividend income is very important and this is where the UK equity & income sector has done so well.

If you have 10k, there is 10 funds available to you and a spread of sectors/funds averaged out to your risk profile would be a lot better than 1 fund of 10k.

deemy2004

Stick to large cap stocks that are sector leaders... Stick to strong sectors and sectors that are able to withstand an economic slow down. Also go for stocks that pay healthy dividends

I'm talking oil majors and utilities

Typically - Shell, UU, BHP etc.. Say throw in a bank with a high yeild - TSB...

And offcourse - avoid property related stocks / sectors.

But do your own research !

The FTSE has been rising for 2 years ! BUT ! THIS IS STILL a YOUNG bull market - Nowhere near the speculative excesses of a bubble.

There is a wall of money that is pouring into equities - Which is clearly apparent that even BAD NEWS has NO EFFECT - A classic sign that the market has shifted gears ! and those waiting for a fall to buy, may be waiting all the way to 6000+ !!!!

So all aboard and enjoy the ride

cellardoor

Where can I read up on UK Equity & Income or equities?

Cheers

Moorepart

Hear you go,http://www.financialexpress.net/

Conrad

ivegotabig1 wrote:

well it seems the housong bonanza has finally come to an end, little or no money to be made there !! interest rates a low, & look to be heading lower, so a lot of money seems to heading into stocks !! if you had say 10k to invest, what sectors or stocks would look like a safe bet to you !! or would an index tracker be a safer better option ???..

Ive sold by B2L portfolio.
In terms of long term growth I like a TRUE (not managed) FTSE tracker. The true trackers have very low charges. Over last 24 months the FTSE tracker funds have ourperfomed 70% of managed (high charges) funds and have far lower charges as they arent managed.

So I would put say 40% in FTSE tracker. Beware some trackers, they are semi managed and have too high fees.

The rest I am using Unit Trusts investing abroad (not Investment Trusts as they can get highly geared and you arent necessarily closely linked to the underlying assets), with the max ISA wrapped amounts.

I like geographical areas that are up and comming. These populations want western living standards and they will achieve them over next 20 years through massive economic growth. I favour Malaysia (already very developed though), China, Eastern Europe, Russia, Vietnam. Also consider S America.

IFAs tend not to recommend investing abroad, but they also told me not to do B2L (1997) recommended with profits bonds (which I declined as any muppett can see the high charges and layers of fund managers wouldnt produce decent returns). DO THE OPPOSITE OF THE HERD. Buy into property stocks in about 12 months time when they are unpopular.

Above all note this; I get a few investment publications, some aimed at the indusrty. There are all manner of complex sounding bonds and packaged products but in the end most of what u read is total BS. In the end it all comes down to the performance underlying shares in companies and geograhpic areas. I try and mentally 'strip - away' all the hype and technical bull you read.

Ive seen many flashy sounding packaged investments with long names over the years, and many of these produce terrible net outcomes. Keep it simple.

EdInvestor

Check out the High Yield Portfolio idea. IME it works a treat

Dividend yield of c.5% overall obtainable at present, reinvest themn if you are young and want growth other wise take the (tax free) income.Both these HYPs have done better than cash and better than the FTSE.You pay no charges or commissions after initial purchase which helps a lot.

For the full risk protection, 15 diversified shares are recommended, but 10 gives very decent protection, you can add more as the divi income comes in. Other risk filters are high market cap, high yield, low debt/gearing.Oce you've set this up you can just leave it basically, very trouble free.

A simple, no hassle idea which works even through a stockmarket crash - as you can see with the first HYP bought in late 2000, now nearly 5 years old. The FTSE has yet to recover, while the HYP is steaming ahead.

deemy2004

Yep when the market was weak i.e. it could go up, it could go down it could go sideways... my attitude was - what the hell - Ive got high yeild stocks for the long-term so over time whether it drifts in the meantime.. in the long-term the dividend income will induce a rise as the yeild is SO good !

dunstonh

In terms of long term growth I like a TRUE (not managed) FTSE tracker. The true trackers have very low charges. Over last 24 months the FTSE tracker funds have ourperfomed 70% of managed (high charges) funds and have far lower charges as they arent managed.

You can look at things in the short term and you are not comparing like for like. Managed funds can cover a range of investment areas. Latin America, commercial property shares, far east, Emerging Europe have all outperformed the FTSE100.

So I would put say 40% in FTSE tracker. Beware some trackers, they are semi managed and have too high fees

I wouldnt at this time. Of course we cant give advice here anyway as that is a breach of website rules and FSA guidelines but I don't put money all in one sector. The UK tends to be top performing sector once every 5-7 years historically. Put all you money in there and you will be lucky 2-3 times over 15 years.

I like geographical areas that are up and comming. These populations want western living standards and they will achieve them over next 20 years through massive economic growth. I favour Malaysia (already very developed though), China, Eastern Europe, Russia, Vietnam. Also consider S America.

Me too. However, these are much higher risk than UK equity.

IFAs tend not to recommend investing abroad

IFAs have to recommend based on attitude to investment risk. The minute you involve overseas investments, you are going into med/high and high risk areas. The reality of the situation is that the average person hasnt wanted to be in those risk areas.

recommended with profits bonds (which I declined as any muppett can see the high charges and layers of fund managers wouldnt produce decent returns).

A with profits bond doesnt sound right for you at all based on your risk tolerance. However, it can still be a damn fine investment. Its all a case of the right thing for the right person. You can get With Profits bonds which are over 10% up on last year with capital security and no MVR. I still put expectation at 5-7%p.a. on that which for the low risk involved, isnt at all bad.

Ive seen many flashy sounding packaged investments with long names over the years, and many of these produce terrible net outcomes. Keep it simple.

I would go along with that. Get the right tax wrapper and choose a provider with access to a large number of funds and has the features you need.

If you want a punt, the going global and not UK seems to be the general speak of the moment. However, whatever anyone decides to do, they should make sure they invest to suit their own risk profile and not anyone elses.