Share dealing

[MarkR]

It is a good rate. Looking forward to hearing about your experiences with them.

[Ian C]

There's a saying you may have heard of: "Don't let the tax tail wag the investment dog".

 

I hadn't heard of the phrase but I follow the theory behind it. I've only got one share in an ISA and I'm in about 6 others with normal investments that aren't ISA friendly. No way would I be out of those just for tax reasons

[Wez]

Not sure I follow, can you guys explain as this is all new to me.

[Soop Dogg]

Probably not the wisest time for seculating/investing , more finding the safest haven

In the 1930 crash ,most money was lost by those who thought the market was at bottom an bought- only for it to drop further

 

.......and then they SOLD out of panic.

 

If many had held on, they would have eventually made money.

 

If you're buying/selling shares, you need to decide if you are a trader or an investor. Trading is much more difficult to make money at. (ask me how I know that....)

 

These days I consider myself to be an investor. I'm fully invested just now in AIM stocks that I'm hoping will pay off within the next 3 to 5 years. But I can understand those who want to make money faster than that. It's just that if you hurry things, you're likely to lose money.

[stevie_b]

Not sure I follow, can you guys explain as this is all new to me.

 

Sure, any part/post specifically?

 

Do you mean the tax tail/investment dog thing? Ask yourself this: would you still make an investment in a particular stock/fund if it were not ISA-able? If not, don't invest just because it is. Not all shares can be held in an ISA: most AIM stocks as Ian said probably can't be. The more "mainstream" the share (e.g. FTSE100 stocks), the more likely it can be held in an ISA.

[Wez]

Sure, any part/post specifically? Do you mean the tax tail/investment dog thing?

 

Yep and what are none ISA friendly that Ian talks about?

[Ian C]

Not sure I follow, can you guys explain as this is all new to me.

 

To give you a good example, both Soop Dogg and I are invested in the same AIM share, call it Bloggo Mining. AIM stuff is considered volatile and risky, and isn't as regulated as, say, the FTSE. These stocks are only listed on AIM, so aren't valid for an ISA - they need to be dual-listed (on at least two stock exchanges) to qualify.

 

So, you might think, I won't buy Bloggo Mining corp like Soop Dogg and Ian C have, because if I make money on it, I'll get stung for 18% capital gains tax. Instead I'll invest in Lloyds TSB shares in an ISA instead.

 

However, if all goes to plan with Bloggo Mining, the volatility will work in our favour, we are in at the tip of the iceberg, and they make a big discovery of richanium. The share price goes from 5p to £1 (this can and does happen, of course it could go bust or halve or do nothing for 5 years etc.) and we make a fortune. OK, 18% goes to HMG, but are still left with oodles of cash.

 

Meanwhile, Lloyds goes up maybe 10% max, hell, maybe it goes up 50%. You can cash that in and not pay 18%, but you missed out on a twentyfold increase of your cash (minus 18%) instead. That's what happens when the "tax free" part becomes your overriding concern.

 

Of course, there isn't much chance Lloyds will fall to bits and lose you all your investment, but you pay your money and you take your (carefully considered and researched, but nonetheless) chances

 

Put it this way - if Bloggo Mining does what it should do in the next couple of years, and so far all indications are strong, my mortgage will be wiped out. I think the chance of killing it 30 years early is certainly worth the punt of cash I've put on it and forgotten about already.

[stevie_b]

Yep and what are none ISA friendly that Ian talks about?

 

See my comment about mainstream stocks: my edit crossed your post in cyberspace.

 

AIM stands for Alternative Investment Market. It's a little "off the beaten track" in terms of UK shares. Not dodgy or anything like that, merely small companies that are listed on a different exchange to the London Stock Exchange (LSE). AIM listings have less arduous accountancy regulations so it attracts small startup companies. Liquidity may not be as good as FTSE shares, but small companies often have the ability to produce fantastic returns (or go bust!), more so than mainstream ones.

[Wez]

Makes sense, thanks Ian

[Wez]

Thanks Stevie.

[Soop Dogg]

Stuff

 

Go Bloggo Mining!!!

 

 

I'm hoping it'll pay my mortgage off too.

 

[Wez]

Well I have signed up to SimplyStockBroking with a normal trading and a Stocks & Shares ISA, I deposited a small amount of money into the ISA fund and purchased some RBS and Lloyds shares as they are currently low like most Fridays.

 

Just updating the iPhone so I can install the app.

 

I can see this trading is going to take some investigation and really needs large purchases over 1k to gain anything. I enjoy learning new stuff so lets see how it goes

[stevie_b]

Good work Wez, let us know how it goes (in broad terms) and what you think of Simply.

[Wez]

Good work Wez, let us know how it goes (in broad terms) and what you think of Simply.

 

The interface, purchasing and signup couldnt have been easier, top marks so far, although I have nothing to compare it too but as a beginner it seems great.

 

I would however like a live share price stream, not sure if they have one.

[Dnk]

I reckon it's best to go spend the money in a casino - at least you get free drinks while you're losing your money.

 

I agree but even better if you walk out winning and paying for your holiday in Portugal on your 1st night there

[Wez]

iPhone updated and app installed, all working a treat

[stevie_b]

I would however like a live share price stream, not sure if they have one.

 

I don't think iii have one either. It's probably not very useful for investors, but certainly useful for traders (which I'm not). One thing I like about iii is the ability to set text message alerts when a price reaches a set level (either on the upside or downside): an easy way to manage stop losses.

[jagman]

It really isn't the time to be into the stock Market- you can get burnt in the coming months/ years

Many professional traders are about to find this out!!

[Soop Dogg]

I don't think iii have one either. It's probably not very useful for investors, but certainly useful for traders (which I'm not). One thing I like about iii is the ability to set text message alerts when a price reaches a set level (either on the upside or downside): an easy way to manage stop losses.

 

As far as my AIM shares go, I gave up on setting stop losses as the market makers can walk a price down just to trigger them. Then they get to mop up cheap shares.

 

Different situation with FTSE shares obviously, where market forces drive the price to a much greater degree.

 

Take a look at the book 'The Naked Trader' if you're thinking of trading as a second income. It's interesting stuff, but to my mind, I've turned to becoming more patient with stock. In my first year I tended to overtrade and would have been a whole lot better off if I'd hung onto some shares for longer. You can get some good tips on how to research different companies and on general terms etc in the stock market.

[Soop Dogg]

It really isn't the time to be into the stock Market- you can get burnt in the coming months/ years

Many professional traders are about to find this out!!

 

When things are pretty low - as they are now - it's exactly the time to be in the stock market. However, you do have to be very careful and do lots of research before picking a stock. Also - NOT being a trader is where I am now. I'm investing - not buying today and selling within the same month for a quick buck - that's how many 'traders' lose millions.

 

Someone once said that the stock market is a mechanism for the transferring of wealth from the impatient to the patient. Never a truer word spoken!

[Paul]

I've got about 10K in 'Meggitt' shares, steady rise over the last few months but taken a bit of a dip over the last few days

I think I need to let them rise a bit then sell and spread the risk over a few companies though but not sure what to go into?

[Dnk]

From what ive been recently reading we could be heading into a very serious crash and i for one am steering well clear of the stockmarket.

[Dnk]

City fears of 'Great Depression Mark II'

 

Edmund Conway, 0:14, Friday 21 May 2010

Leading City experts have started raising the prospect of "Great Depression II" amid worries that the European economic crisis could trigger a deeper bout of chaos.

 

Markets on both sides of the Atlantic dipped to fresh lows as fears surrounding the fate of the euro project transmuted into worries about the wider global economic system.

 

Bill Gross of bond fund Pimco said that hedge funds were starting to liquidate their positions in a bid to preserve their capital a worrying "mini relapse" towards 2008 territory.

 

Andrew Roberts, head of European rates strategy at RBS (LSE: RBS.L - news) , said "Great Depression II" could now be approaching, adding: "It now has potential to speed toward its conclusion; a European $1trn package which does little and political panic tells you we are about to reach the end of the road. The world should be discussing deflation, not inflation."

 

The FTSE 100 flirted briefly with the 5,000 point mark, eventually finishing the day down 84.95, or 1.7pc, at 5073.13, while the French CAC 40 index was 2.3pc lower and Germany's Dax (Xetra: news) dropped 2pc. The S&P 500 and the Dow Jones (news) index both suffered their sharpest one-day falls in more than a year. The S&P fell 3.9pc to 1071.59, while the Dow closed 3.6pc lower at 10,068.01.

 

The falls in share prices coincided with increases in the price of government bonds in Germany, the US and much of the developed world as investors sought a safe haven. German 10-year bund yields consequently hit a record low, while in the UK gilt yields dropped to the lowest level since early last December.

 

Although the rush to safety stems originally from the euro's difficulties this week and German efforts to ban short-selling on its banks , fears that the episode may evolve into a deeper economic crisis were bolstered by fresh data. The European Commission produced "flash" data showing consumer confidence falling from a 23-month high of -15 in April to a seven-month low of -17.5 in May. Howard Archer, of INS Global Insight, said: "This is clear evidence that the deepening and spreading eurozone debt crisis... is now weighing down appreciably on consumer confidence. This is a very worrying if hardly surprising development."

 

In the US there was a surprise 25,000 increase in jobless claims to 471,000 in the week ending May 15. The deterioration in the employment picture, coming hard on the heels of Wednesday's drop in inflation, underlined worries that the US is exposed to a possible global double-dip recession.

 

Mr Gross said investors were now being frightened off by worldwide "fiscal tightening momentum", adding that markets were facing "a mini-relapse of a flight to liquidity as hedge funds and other leveraged positions are liquidated to preserve capital".

 

One worry is that European leaders are not sufficiently behind the $1 trillion bail-out fund they announced, in collaboration with the International Monetary Fund, last week. A second fear is that other indebted countries could soon be exposed.

 

One rumour abounding on Thursday was that a major rating agency will soon have to downgrade Japan's credit score, potentially bringing the world's second-biggest economy into the spotlight.

[stevie_b]

It's certainly interesting times in the stock market. I hold a small number of FTSE100 shares: not enough to either make or break me, so to that extent it's a bit of moderately expensive fun. I honestly don't know whether to cash it in and pick it up further towards the bottom, or hang in there. I've got a lot to learn about the psychology of investing and shares.

[Wez]

Interesting read, thanks

 

For me its just a bit of fun really, are there any good/recommended sites for tips, tricks, hints and general info?