70k to invest, buy to let?
Discussion
I was watching a Peter Lynch video and it was quite amusing that so much of the focus of the video was on having the stomach to do nothing when things look bad stocks should be a long term thing.
Buy high and sell low then wonder why you've lost money is a reoccurring theme apparently.
Buy high and sell low then wonder why you've lost money is a reoccurring theme apparently.
Hoofy said:
Tell that to former NRK shareholders. 
Well yes Knowing when to legitimately get out because a business is doomed is something different, my point as a newbie is simply think back to February's little wobble which was when I opened my ISA.One man's "the sky is falling in" is someone else's opportunity if you have cash to buy.
Looking at what happened in 2008 it looks reasonably clear that if you'd held your nerve things would have bounced back with most equities.
There was a study done by Fidelity which found that many of the best investors forgot they had an account or were dead so they weren't (or couldn't) react to short term issues.
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hstewie said:
hstewie said: I was watching a Peter Lynch video and it was quite amusing that so much of the focus of the video was on having the stomach to do nothing when things look bad stocks should be a long term thing.
Buy high and sell low then wonder why you've lost money is a reoccurring theme apparently.
A top stockbroker that I worked with said that to me.Buy high and sell low then wonder why you've lost money is a reoccurring theme apparently.
I watched my £8k turn to nothing in 2000 after the dot com boom
But I was so cool watching them go down.
If you’re holding a few individually chosen company shares and one goes pop when a bubble burst - for example Facebook if the tech bubble bursts and takes half of your portfolio down; then yes, you’re going to make some losses which may not recover in a viable timeframe.
However, if you’re holding lifestrategy or similar - funds which comprise of thousands of different holdings all over the world, you’re much better placed to see a recovery over time.
For the novice, such as myself, it seems like a no-brained. Lifestrategy 100 is now my portfolio backbone. I’ll continue to drip 60-70% of my savings into it, and the remainder I’ll add to a maximum of 2 well-regarded managed funds. Right now it’s just Fundsmith.
I’m a lay of a layperson as anyone on stock picking. This seems to be a very easy, hassle-free, low cost method of set & forget investing.
Make sure to take advantage of ISA or SIPP wrappers. If you’re married, max out hers, too. I’d max out the SIPP first, unless you’re putting 40k a year into your pension, you’re missing out on free money.
However, if you’re holding lifestrategy or similar - funds which comprise of thousands of different holdings all over the world, you’re much better placed to see a recovery over time.
For the novice, such as myself, it seems like a no-brained. Lifestrategy 100 is now my portfolio backbone. I’ll continue to drip 60-70% of my savings into it, and the remainder I’ll add to a maximum of 2 well-regarded managed funds. Right now it’s just Fundsmith.
I’m a lay of a layperson as anyone on stock picking. This seems to be a very easy, hassle-free, low cost method of set & forget investing.
Make sure to take advantage of ISA or SIPP wrappers. If you’re married, max out hers, too. I’d max out the SIPP first, unless you’re putting 40k a year into your pension, you’re missing out on free money.
Edited by Testaburger on Sunday 17th June 14:47
I’ve a big family home up North that I rent out until I move back there, the sort of place that you’d hope will be lived in by older professionals (rent is about 50% more than the gross household wage), and it has still been a nightmare at times. The last tenants did not look after it at all, leaving a huge amount of work to be organised and paid for.
The effort level will likely be no less on a less expensive property, so you do need to be sure that you are up for it.
The effort level will likely be no less on a less expensive property, so you do need to be sure that you are up for it.
bhstewie said:
hstewie said:Pesty said:
This isn’t helping
They would bounce back with very few exceptions.Think of someone walking uphill whilst playing with a yo-yo is the best analogy I heard.
Pick a point in time and it will vary but over the long term the direction should be upward.
Hoofy said:
Not working for Trinity Mirror. Still half of their dotcom price. So is Barclays. Will stop searching for more.
I think you'd admit that they're in sectors that are relatively exceptional as banking was riding an unsustainable bubble at the time and Trinity Mirror's sector has far more online competition nowadays, while traditional newspaper publishing has declined.Point taken though. Not every company holds a share price higher than pre-credit crunch. Some have declined while some have a more reasonable valuation.
Hoofy said:
Not working for Trinity Mirror. Still half of their dotcom price. So is Barclays. Will stop searching for more.
Of course, it can happen, otherwise anyone would just buy any old stocks and be in the money.Newspapers have struggled to keep up with the competition and Terry Smith's comments on banks was all I needed to hear which is he simply can't understand their books in spite of having worked for one.
Interesting anecdote from Terry Smith on banks:
Terry Smith said:
The fragility of banks is illustrated by a story from the 1980s, when there was a wave of nervousness in Hong Kong following the signing of the joint declaration regarding the colony’s handover to China. Property prices began to collapse and banks ran up bad debts as result.
During this febrile period, a queue of people waited for a bus. It started to rain, and the queue moved across the pavement to shelter under the cover of a canopy on a building, which happened to house a branch of a local family-controlled bank. Passers-by, seeing the queue, concluded that there was a problem with the bank. Rumours of a run spread rapidly and by the following day the bank was besieged by depositors demanding to withdraw their savings.
During this febrile period, a queue of people waited for a bus. It started to rain, and the queue moved across the pavement to shelter under the cover of a canopy on a building, which happened to house a branch of a local family-controlled bank. Passers-by, seeing the queue, concluded that there was a problem with the bank. Rumours of a run spread rapidly and by the following day the bank was besieged by depositors demanding to withdraw their savings.
bhstewie said:
hstewie said: They would bounce back with very few exceptions.
Think of someone walking uphill whilst playing with a yo-yo is the best analogy I heard.
Pick a point in time and it will vary but over the long term the direction should be upward.
Sadly I kept an online account going to see if they would pick up. One bunch of shares did but after I had sold them at a loss. The rest went into administration.Think of someone walking uphill whilst playing with a yo-yo is the best analogy I heard.
Pick a point in time and it will vary but over the long term the direction should be upward.
Testaburger said:
For the novice, such as myself, it seems like a no-brained. Lifestrategy 100 is now my portfolio backbone. I’ll continue to drip 60-70% of my savings into it, and the remainder I’ll add to a maximum of 2 well-regarded managed funds. Right now it’s just Fundsmith.
I’m a lay of a layperson as anyone on stock picking. This seems to be a very easy, hassle-free, low cost method of set & forget investing.
I can understand LS100 being set and forget but interested to hear you think the same of Fundsmith. What happens if/when large cap growth shares fall out of favour?I’m a lay of a layperson as anyone on stock picking. This seems to be a very easy, hassle-free, low cost method of set & forget investing.
BarryGibb said:
I can understand LS100 being set and forget but interested to hear you think the same of Fundsmith. What happens if/when large cap growth shares fall out of favour?
FS doesn’t have the balance of LS100, but I chose it as in my view, the stock selection appeals to me. I’d prefer it to be less overweight in tech, but otherwise it’s a well-selected portfolio of everyday consumables - stuff which sells regardless of the economic cycle.That said, if large-cap stocks fall out of favour, LS100 will take a hammering, too.
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