HSBC Sharedealing Account - What Can I Lose?

HSBC Sharedealing Account - What Can I Lose?

Author
Discussion

Progressive

Original Poster:

1,288 posts

170 months

Wednesday 10th October 2012
quotequote all
Hi there,

I am a complete trading novice. I recently set up a HSBC Sharedealing account an now wish to purchase shares in a company (FTSE listed). I have done some research but cannot find an answer for the following. Again, excuse my very basic knowledge, although admittedly I am being somewhat cautious.

I have (say) £1,000 in my HSBC current account and invest (say) £100 in the company I would like to invest in. What is my total risk in my investment?

Is it £100 or am I exposing my myself (read my current account)? Should the share price fall to £0.00 or the company go bust, do I just lose my stake of £100 or am I liable for more.

Thanks for your assistance!

soprano

1,572 posts

181 months

Wednesday 10th October 2012
quotequote all
Progressive said:
Hi there,

I am a complete trading novice. I recently set up a HSBC Sharedealing account an now wish to purchase shares in a company (FTSE listed). I have done some research but cannot find an answer for the following. Again, excuse my very basic knowledge, although admittedly I am being somewhat cautious.

I have (say) £1,000 in my HSBC current account and invest (say) £100 in the company I would like to invest in. What is my total risk in my investment?

Is it £100 or am I exposing my myself (read my current account)? Should the share price fall to £0.00 or the company go bust, do I just lose my stake of £100 or am I liable for more.

Thanks for your assistance!
You can't lose more than you invest

You also need to consider the share trade fee and stamp duty

Lawrence5

1,238 posts

216 months

Wednesday 10th October 2012
quotequote all
I think HSBC is a normal share platform. You get fees even if your in cash on the share account and there are fees fo selling too. If you work out its £10 to buy and £10 to sell and 0.5% stamp duty there's a fair bit to cover.....

Read the naked trader by Robbie Burns.... Suggests with costs you should be thinking about £2k in shares as a minimum.

You can look at spread betting (plenty on here about it) where you don't have to buy the share just bet on gains and losses. But I you are risk adverse then it's not for you.....

raptor600

1,356 posts

127 months

Wednesday 10th October 2012
quotequote all
Buying £100 of one stock is absolute suicide.

You will pay £10 to buy and £10 to sell - and 0.5% stamp duty.

You are down 20.5% straight away!

The absolute minimum I would say you should invest in one stock is £1000.

Lawrence5

1,238 posts

216 months

Wednesday 10th October 2012
quotequote all
HSBC regular saver may be a better bet - save up to £250 a month paying 6% interest or 8% on premier. Then buy a block in a couple of years....

Oh and do look at the fees - I went elsewhere even though I bank with HSBC

hornet

6,333 posts

231 months

Wednesday 10th October 2012
quotequote all
Assuming you haven't already, why not open a Shares ISA? Index trackers and ETFs are generally cheap, and most will allow you to drip feed a regular investment. Far better bet than putting all your eggs in one basket IMO.

Progressive

Original Poster:

1,288 posts

170 months

Thursday 11th October 2012
quotequote all
raptor600 said:
Buying £100 of one stock is absolute suicide.

You will pay £10 to buy and £10 to sell - and 0.5% stamp duty.

You are down 20.5% straight away!

The absolute minimum I would say you should invest in one stock is £1000.
Hi there,

Completely aware of this. The numbers were straight forward examples for the sake of ease and confidentiality on a public forum.

Point noted though, as it's important.

Cheers

Progressive

Original Poster:

1,288 posts

170 months

Thursday 11th October 2012
quotequote all
raptor600 said:
Buying £100 of one stock is absolute suicide.

You will pay £10 to buy and £10 to sell - and 0.5% stamp duty.

You are down 20.5% straight away!

The absolute minimum I would say you should invest in one stock is £1000.
Hi there,

Completely aware of this. The numbers were straight forward examples for the sake of ease and confidentiality on a public forum.

Point noted though, as it's important.

Cheers

fid

2,426 posts

221 months

Thursday 11th October 2012
quotequote all
You could lose the will to live if you broke your little key log-in thingy the day you need to sell some shares sharpish! Bloody stupid that HSBC make us use these for InvestDirect.

Progressive

Original Poster:

1,288 posts

170 months

Thursday 11th October 2012
quotequote all
fid said:
You could lose the will to live if you broke your little key log-in thingy the day you need to sell some shares sharpish! Bloody stupid that HSBC make us use these for InvestDirect.
Oh yes. Never even gave that a thought. Another poor example of those annoying little things.

What's the benefit of the 'bank' sharedealing accounts over a third party one? All I can think of it convenience...

Lawrence5

1,238 posts

216 months

Thursday 11th October 2012
quotequote all
Progressive said:
Oh yes. Never even gave that a thought. Another poor example of those annoying little things.

What's the benefit of the 'bank' sharedealing accounts over a third party one? All I can think of it convenience...
Charges are the main 3rd party benefit
https://investments.hsbc.co.uk/pdf/41018-Invest-Di...


<<Rates and fees – other charges
HSBC UK Funds of Funds – Initial Charge 1% taken from your original investment.
}Annual Management charge 1.25%
}Other expenses approximately 0.8% per year>>

I use shareprice iPhone and android app £9 flat trading fee and bugger all other charges.... Just make sure you pick something regulated if using the Internet.

charlie926J

108 posts

122 months

Thursday 11th October 2012
quotequote all
You might like to look at the Motley Fool website - fool.co.uk Plenty of common sense articles on there about starting in buying shares and building up portfolios. A lot of them relate to buying/investing for dividend yield which is a longer term type of investment. Also an active message board section.

No idea about the HSBC account, I use Stocktrade.

AndySpecD

436 posts

168 months

Thursday 11th October 2012
quotequote all
Taking things slightly o/t, anyone able to recommend a company that I can use to buy and sell shares online that is decent, has limit buys/sells and is cheaper than HSBC.

I took the attitude that £12.95 on purchase and sale wouldn't cut into my profits too much, then adding it all up, it's been nearly £800 in the last 12 months!!

Dakkon

7,826 posts

234 months

Thursday 11th October 2012
quotequote all
I use Iweb and they have just dropped their fees to £5 a trade buy / sell.

twinturboz

1,278 posts

159 months

Monday 15th October 2012
quotequote all
AndySpecD said:
Taking things slightly o/t, anyone able to recommend a company that I can use to buy and sell shares online that is decent, has limit buys/sells and is cheaper than HSBC.

I took the attitude that £12.95 on purchase and sale wouldn't cut into my profits too much, then adding it all up, it's been nearly £800 in the last 12 months!!
How often are you trading?

Newc

1,556 posts

163 months

Monday 15th October 2012
quotequote all
twinturboz said:
AndySpecD said:
Taking things slightly o/t, anyone able to recommend a company that I can use to buy and sell shares online that is decent, has limit buys/sells and is cheaper than HSBC.

I took the attitude that £12.95 on purchase and sale wouldn't cut into my profits too much, then adding it all up, it's been nearly £800 in the last 12 months!!
How often are you trading?
I'm going to take a stab in the dark here and guess an average of 5 times a month ?

OP - Interactive Brokers are £6 / trade and have an extensive set of security types available.

twinturboz

1,278 posts

159 months

Monday 15th October 2012
quotequote all
Newc said:
twinturboz said:
AndySpecD said:
Taking things slightly o/t, anyone able to recommend a company that I can use to buy and sell shares online that is decent, has limit buys/sells and is cheaper than HSBC.

I took the attitude that £12.95 on purchase and sale wouldn't cut into my profits too much, then adding it all up, it's been nearly £800 in the last 12 months!!
How often are you trading?
I'm going to take a stab in the dark here and guess an average of 5 times a month ?

OP - Interactive Brokers are £6 / trade and have an extensive set of security types available.
Tdwaterhouse is £8.95 if your trading 15 times + a quarter.

Was going to suggest IB as I use them myself but they also have a market data charge to take into account Think £5 a month for lse data, not a lot if your regularly trading and more than worth it considering the platform is light years ahead of the rest.

If I remember right Tdwaterhouse used to take 10 mins plus just to change or cancel a limit order.


Birkin1932

776 posts

120 months

Wednesday 17th October 2012
quotequote all
Based on the OP's comments, I would say DO NOT TRADE

Get some books etc and maybe trade then.

I'm afraid you will get burnt.

I would never trade shares in the normal sense, I would set up a spread betting account, you then have no tax issues,.

BUT AGAIN I STRESS YOU REALLY NEED TO KNOW WHAT YOU ARE DOING, MARKET MAKERS ARE EXPERTS AT RELIEVING AMATEURS OF THEIR HARD EARNED CASH.

Edited by Birkin1932 on Wednesday 17th October 22:01