OT Shares

Following on from the Savings thread, I can't help but notice that
virtually all the major market share prices have collapsed.

They're starting to recover and I can't help wondering if now is a good
time to invest £50k or more in something like FTSE 100?

From where its at now it seems to me that you should easily see a 50%
increase in the FTSE in 5 years, MS 50%, Google 100%.

Anyone else here who does direct share dealing themselves?

I know we've got people here who work for investment companys (Darsy?)
but I mean people doing this from home using things like Motley Fools
£1.50 per trade share dealing service?

Any recommendations for places like the Motley Fool site? And
recommendations for online "Learn Share Dealing for Dummies in 10
Minutes" guides?

 

TBH Frag I think it could have a way to fall yet!!

 

Using the patented Mavis Beacon "Hunt&Peck" Technique, fragmented

crn thinks so.

That's all you need to know.

 

I know sweet FA about shares, finance, and all that malarkey[1].

I *do* know that early last year, at a conference, I said to one of my
Continental contacts: "I think we are headed for an almighty crash in
the UK next year. We've spent too much, we're in debt, and the rising
housing market has got to correct itself. And the government seems to
think that spending in the shops is somehow growing the economy."

I really, really think things have got further to fall. For a start, as
someone pointed out recently, all the guff about the property slide has
ignored the fact that commercial property is taking a similar bath. It
just hasn't been written down yet.

Secondly, because of the general fall in house prices, shares, and
everything else, *plus* the increaed numbers of people out of work, the
government's tax take is going to be *way* less than they budgeted.

It sounds morbid to say it, but The Doctor's Ma, dying when she did, has
lessened our tax liability massively. If she'd died last year, we'd be
in line for (at a guess) £50k in death duties. As it is, we might get
away with nowt. Multiply our situation by however many other people have
died and left share portfolios and houses in their wills.

I also know that for the last couple of years I have been concentrating
on paying back my own mortgage, by making capital repayments I didn't
need to make. And I'm doing it *more* now. I bet I'm not alone in that.

I also ran up some CC debts. Nothing unmanageable (in the sense that if
they were called in, I could flog a few of my bikes and pay them), but
now I'm concentrating on eliminating them altogether. So I'm not
spending. I bet I'm not alone in that, either.

I think it's going to get worse next year. Seat of the pants says it
might bottom out at the end of 2009 but as I said, I know nothing.

[1] Copyright Jamie Oliver.

 

That's a guess. They could be about to plunge further, if there's a
real panic.

The, *the* golden rule is spread your investments. The FTSE 100 is
only UK companies, all large, all Equities.

If it were me I'd be looking at a mixture of OEICs, and trickling into
them over several years (pound cost averaging).

Wow. You could make a fortune.

Hargreaves Lansdown.

 

this is what I did whilst working at Xerox and having plenty of surplus
income, using up my PEP/ISA allowances

consider joining a share club. BBC News Channel is featuring a story
about one they have followed for several years. They've outperformed
city experts every year. I can't find an online link to the story. They
have made a healthy profit this year by being very canny. Selling their
UK stocks and buying $ stocks when the exchange rate was favourable. Now
the £ has weakened their US investments are looking very healthy.
Here's a link to an old story
http://news.bbc.co.uk/1/hi/business/3163330.stm

I use http://www.bestinvest.co.uk/index.aspx as they generally waive the
5% set-up commission charged by most intermediaries for OEICs. They have
a good website that allows you to keep tabs on your portfolio. Although,
looking at it now is a bit depressing.

 

Oh well spotted.

 

*ding*

Wait until early March.

 

I'd have thought buying sheares in recievers and accounting companies
might be where the safe money is for the short term.

 

'Cane' wrote...>

Waitings not going to be a problem. It took 5 years to build up again
after the last crash from the UK graphs I've had a look at.

 

Half of my savings went into a selection of shares 2 months ago.
So far so good, prices are bouncing along at around 10% above their
mid-october bottom. January is always a good month. History shows that
there will be more instability but the long term trend can only be up
from here. Be prepared to hang in there for a year or more and you
will be very unlikely to lose if you pick good quality companies.
Think food, defence, aerospace and the better mining houses.
Avoid companies with a significant debt burden and anything dependant
on non-essential retail consumer spending.

This strategy has worked for me from the bottom of the last 4 recessions.

Ob. Disclaimer :- I am not an expert, do your own research, YMMV etc.

 

'Colin Irvine' wrote...>

Yep. Its always going to be a guess when they've stopped dropping. But
my reasoning is even if they drop after (if) I invest, it'll just delay
the time when they get back to 2007 levels.

After a crash like this is the recovery fairly steady over the whole of
the recovery to past levels?

Heh, I know its small fry to some, but its a lot better than savings and
a lot less hassle than buying reposessed houses & letting them for years

Ta.

 

Good strategy - get rid of expensive debt but keep your options open
to borrow if something goes titzup on you. Build a reserve fund of
enough available cash for a 3 month disaster.

It looks oversold at the moment to me, but ICBW. The only sure thing is
that it will improve if you are prepared to hang in there for the long
term. My theory says around 6 months, some cautious experts are saying
up to 2 years. Obviously any money that you are likely to need in
a hurry should not be in the stock market, sods law says that your
disaster will happen when prices are bad. OTOH at least you can cash out
quickly if you are prepared to take the risk of a loss.

 

TOG said:

Commercial property with a rateable value over 15k (IIRC) was until
recently taxed at 100% if vacant (to "encourage" use through taxation)
- a fairly recent change.

The fact that this no longer applies shows that the government knows
that there will be a LOT of vacant commercial properties vacant in the
coming years, with landlords being well and truly hammered at the full
rateable charge. The introduction of the 100% charge was fairly
controversial at the time - I think they realise now it was mistake,
especially with the economy going south.

Hmmm is this a good time for me to be buying commercial premises?

 

We've not had a similar crash in a similar economic environment
before. Share prices may drop further, they may stay steadyish for a
year or two, they may start to recover soon. You'll find experts
variously predicting all three. But FWIW yes, the market seems
undervalued so yes, eventually prices will rise from current levels
and almost certainly more than interest rates.

 

I have an endowment (a bit under £30k) which matures in March - prolly
not the best time for it to mature.

It seems that for £5 a year, I can get Std Life to invest it and it
remains untaxable (peppercorn investment)

So - any good reason why I shouldn't do this or does that seem the best
course of action?

 

Ding.
http://money.cnn.com/2008/12/30/markets/2009_look_ahead/index.htm?postversion=2008123110

 

I looks all right to me, and you can choose from a (limited) range of
funds where you want your money to go. On the other hand, it is all
your money in the hands of one organisation. Plus, if you read the
small print, I suspect you'll be limited to a relatively small
withdrawal each year if you want that to be tax free. So a lot depends
on how long you want your money to stay there.

You could take £14,400 of it in cash in March, put £7,200 in a 2008/09
share ISA and the other £7,200 in a 2009/10 share ISA the following
month. If you have other ISA plans either leave more of it with
Standard Life or sacrifice some tax-freedom for flexibility and invest
elsewhere.

If it was me I'd do a modified version of the above but keep a chunk
back as cash to trickle back into the market, in case prices continue
to drop. If you have spare ISA capacity you can do this by buying a
cash ISA and later converting it to share [1].

This is what I would do, not investment advice!

[1] This rule has been introduced recently. You'd need to check if it
applies to new cash ISAs or simply old ones.

 

I don't think anyone really knows but....

The major question is when the bottom comes and when to buy for the long
term returns. However, I think that there are signs that some shares are
already at a certain level and whilst they go up and down a bit they're
basically just about bumping along the bottom. Typically these are more
diversified businesses that were sometimes criticised for being too
conservative in the boom years, but are fit, pay dividends and are capable
of giving a reasonable return in any upturn in 2010 .

I'll be looking to buy sometime in Feb when things may be a bit clearer.
There's no rush and I only base that date on the fact that then I'll be in a
position to take about seven grands worth of shares (at a reasonable price
through a sharesave plan) in the company I work for, I'll have cashed in all
my premium bonds and I'll also have a clearer view of my 2009 job prospects.

Please note that the above is my personal opinion [1], I am not an
investment proffessional and is more likely to be completely wrong than
right.

Probably.

**** it, it's a gamble isn't it?

--
Chris H,
FZS1000, two#55
He's predictable, but that's to be expected.
Please remove the numbers to reply

[1] I may still be drunk from last night.

 

'' wrote...>

So if I take the next couple of months learning about this stuff it
should be about the right time to invest.

Nice