Anyone dabble in Shares?

Anyone dabble in Shares?

Author
Discussion

mercGLowner

Original Poster:

1,668 posts

186 months

Saturday 25th July 2009
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I have set myself up with a share account with Selftrade and am ready to start, but I lack a bit of confidence! Anyone dabble in this field?

Was thinking a high risk strategy required, speculate to accummulate and all that. Idea is to buy £7K of LLoyds Banking Group or RBS shares and sit back and see what happens! There is no way these institutions can go to the wall, afterall the taxpayer owns a vast share of them, and this must be about the bottom of the market, so actually risk is acceptable to me.

ShadownINja

76,666 posts

284 months

Saturday 25th July 2009
quotequote all
Yes, I do. Unless you know for sure, then that's a high risk, so as long as you don't mind losing the £7k (all of it), then proceed.

mercGLowner

Original Poster:

1,668 posts

186 months

Saturday 25th July 2009
quotequote all
Accept it is risky, but the only way I would loose £7K is if the the company went tits up, whats the chance of this? Don't think Gordo and darling would allow this, Would see me being in for the medium term so fluctuations would be expected.

grumbledoak

31,602 posts

235 months

Saturday 25th July 2009
quotequote all
rofl

This years lesson is likely to be brought to you by the words "Shirt", "Back", and the phrase "Gee, I'm cold".

Unless there was been a massive drop while I was watching Iggle Piggle yesterday, neither of the shares you mention are near their low. Nowhere near their highs, either, but you'd be mad to think that they can only go up!

I suppose you have asked for high risk. Dabbling in shares as an amateur with your own money is exactly that.

mercGLowner

Original Poster:

1,668 posts

186 months

Saturday 25th July 2009
quotequote all
grumbledoak said:
rofl

This years lesson is likely to be brought to you by the words "Shirt", "Back", and the phrase "Gee, I'm cold".

Unless there was been a massive drop while I was watching Iggle Piggle yesterday, neither of the shares you mention are near their low. Nowhere near their highs, either, but you'd be mad to think that they can only go up!

I suppose you have asked for high risk. Dabbling in shares as an amateur with your own money is exactly that.
Thanks for the constructive comments, much appreciated.

grumbledoak

31,602 posts

235 months

Saturday 25th July 2009
quotequote all
I'll spell it out, then:

grumbledoak said:
neither of the shares you mention are near their low. Nowhere near their highs, either, but you'd be mad to think that they can only go up!
If you wanted a high risk banking share investment you should have done it while Gordon was dithering. They were very low, and quite possibly technically bankrupt, you could have bought more shares, though you risked losing it all.

Now, with government intervention, they are more stable and the share price is higher. So, you'll get less shares for your money. Sure, Gordon's cowardice makes it unlikely that he'll allow them to fail- after all, he has every penny of your childrens' future tax to shore them up with. But, he could just as easily parachute some of his equally useless mates into the top positions and those institutions could languish at their current price for decades.

If you can afford to lose every penny of this money, go ahead. But, I'd recommend some care and some reading. "A year in the life of an average investor", if I have remembered the title correctly, will at least tell you about all the different forms of 'investing'. And, it costs much less than £7k.

Best of luck.

ShadownINja

76,666 posts

284 months

Saturday 25th July 2009
quotequote all
mercGLowner said:
Accept it is risky, but the only way I would loose £7K is if the the company went tits up, whats the chance of this? Don't think Gordo and darling would allow this, Would see me being in for the medium term so fluctuations would be expected.
It wouldn't go tits up... it would be nationalised. Is this not a possibility?

mercGLowner

Original Poster:

1,668 posts

186 months

Saturday 25th July 2009
quotequote all
grumbledoak said:
I'll spell it out, then:

grumbledoak said:
neither of the shares you mention are near their low. Nowhere near their highs, either, but you'd be mad to think that they can only go up!
If you wanted a high risk banking share investment you should have done it while Gordon was dithering. They were very low, and quite possibly technically bankrupt, you could have bought more shares, though you risked losing it all.

Now, with government intervention, they are more stable and the share price is higher. So, you'll get less shares for your money. Sure, Gordon's cowardice makes it unlikely that he'll allow them to fail- after all, he has every penny of your childrens' future tax to shore them up with. But, he could just as easily parachute some of his equally useless mates into the top positions and those institutions could languish at their current price for decades.

If you can afford to lose every penny of this money, go ahead. But, I'd recommend some care and some reading. "A year in the life of an average investor", if I have remembered the title correctly, will at least tell you about all the different forms of 'investing'. And, it costs much less than £7k.

Best of luck.
Thank you. Maybe the banks are not out of the woods yet.

I do have a variety of investments, not managed by me I have to say, and this was just a scheme to have a go myself, whilst I wouldn't say that I could quite happily loose £7K, I clearly need to do a little more research first !

UpTheIron

4,004 posts

270 months

Sunday 26th July 2009
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ShadownINja said:
It wouldn't go tits up... it would be nationalised. Is this not a possibility?
Exactly...and that didn't work out too well for Railtrack shareholders did it?

UpTheIron

4,004 posts

270 months

Sunday 26th July 2009
quotequote all
mercGLowner said:
Was thinking a high risk strategy required, speculate to accummulate and all that. Idea is to buy £7K of LLoyds Banking Group or RBS shares and sit back and see what happens!
So think on a little more about your plan:

- why these two banks in particular?
- how much do you think the price will rise?
- if it does rise, when do you sell? You can't just "sit back" forever
- if the price falls, when do you sell and cut your losses?

ShadownINja

76,666 posts

284 months

Sunday 26th July 2009
quotequote all
UpTheIron said:
- if it does rise, when do you sell?
At the next recession when it's worth £3500. biglaugh

Seriously, though, good advice... need to have an exit strategy, not just "take it out in 10 years time" or "when it's in some profit".

rickybouy

266 posts

218 months

Sunday 26th July 2009
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RBS will be around at least 70-80 pence by xmas currently around 42 pence, of course there is no guarantee. i would say if you are prepared to wait 2-3 years the banks you mentioned are safe bets.

ShadownINja

76,666 posts

284 months

Sunday 26th July 2009
quotequote all
rickybouy said:
RBS will be around at least 70-80 pence by xmas currently around 42 pence, of course there is no guarantee. i would say if you are prepared to wait 2-3 years the banks you mentioned are safe bets.
EWT?

rickybouy

266 posts

218 months

Sunday 26th July 2009
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"EWT?" what does that mean?

ShadownINja

76,666 posts

284 months

Sunday 26th July 2009
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Just wondering what your prediction is based on. EWT= Elliot Wave Theory. Everyone knows that on PH, I thought. wink

northandy

3,496 posts

223 months

Sunday 26th July 2009
quotequote all
mercGLowner said:
I have set myself up with a share account with Selftrade and am ready to start, but I lack a bit of confidence! Anyone dabble in this field?

Was thinking a high risk strategy required, speculate to accummulate and all that. Idea is to buy £7K of LLoyds Banking Group or RBS shares and sit back and see what happens! There is no way these institutions can go to the wall, afterall the taxpayer owns a vast share of them, and this must be about the bottom of the market, so actually risk is acceptable to me.
Like others have said dont do it if you cant afford to lose it. Also be careful tying it up, if you need it in an emergency then you could get caught out if the price has dropped.

When I first started it seemed like every time I bought a share its price dropped, It didnt make any sense until I realised I was late to the party every time.

Having all your eggs in one basket is risky.

I dont trade huge amounts, 1k is my biggest single purchase, I reckon in the last 12 months I made about £1,500, but most of that came from buying RBS at 15p, and lloyds at 40p, prior to that I was down for the year.

The important thing is not to get greedy, set yourself a target, say you invest £7k, what would happen if the share price rose rapidly and you could sell for £10k in a month ? ask yourself what you would do ?. You need to be ready to jump when you are happy with the return. dont sit thinking once its at 10k it will continue to rise.

Best of luck

Tiggsy

10,261 posts

254 months

Sunday 26th July 2009
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the problem with small share holdings is the research and time to do it right doesnt yeild a good return on your time. depending on your job/investmnet you may find you make more money by working harder/overtime than faffing about with 10k of shares.

rickybouy

266 posts

218 months

Sunday 26th July 2009
quotequote all
Hey Shadowninja,

feel a bit daft now! i do know the Elliot Wave Theory, but was thinking it was some yoof speak wink

my thoughts about RBS shares are based on some friends i know who work in this field and they talk in ways i don't really understand, but basically the shares are undervalued at the moment as rbs net worth is very high and once they pay the government back the prices will obviously rise again.

hope that makes sense

mercGLowner

Original Poster:

1,668 posts

186 months

Sunday 26th July 2009
quotequote all
northandy said:
mercGLowner said:
I have set myself up with a share account with Selftrade and am ready to start, but I lack a bit of confidence! Anyone dabble in this field?

Was thinking a high risk strategy required, speculate to accummulate and all that. Idea is to buy £7K of LLoyds Banking Group or RBS shares and sit back and see what happens! There is no way these institutions can go to the wall, afterall the taxpayer owns a vast share of them, and this must be about the bottom of the market, so actually risk is acceptable to me.
Like others have said dont do it if you cant afford to lose it. Also be careful tying it up, if you need it in an emergency then you could get caught out if the price has dropped.

When I first started it seemed like every time I bought a share its price dropped, It didnt make any sense until I realised I was late to the party every time.

Having all your eggs in one basket is risky.

I dont trade huge amounts, 1k is my biggest single purchase, I reckon in the last 12 months I made about £1,500, but most of that came from buying RBS at 15p, and lloyds at 40p, prior to that I was down for the year.

The important thing is not to get greedy, set yourself a target, say you invest £7k, what would happen if the share price rose rapidly and you could sell for £10k in a month ? ask yourself what you would do ?. You need to be ready to jump when you are happy with the return. dont sit thinking once its at 10k it will continue to rise.

Best of luck
Thanks for that. The trouble with having a few holding is that it increases dealing costs markedly. I do consider that I have a 'plan', and it doesn't involve being greedy, I would just like a decent return, in fact just to break even after 6 months would give me valuable experience.

On reflection the banks are too higher risk at the moment, I am going to take a watching brief on them and see what happens. The consensus appears to be that RBS may well dip down again anyway. I have been looking at Vodafone, a 'medium' risk FTSE100 company. It seems to be in favour at the moment and I have read about a possible takeover of T-Mobile in the future, which wouldn't do the share price any harm.

Fittster

20,120 posts

215 months

Sunday 26th July 2009
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Have you considered reading some of the books available on share dealing?