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20k to invest

Last post Tue, Jan 08 2008, 8:07 PM by maxsteam. 6 replies.
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  •  Tue, Jan 08 2008, 8:07 PM

    Re: 20k to invest

    I've just sent my son's child trust fund voucher off to go into the F and C Investment Trust. That's a £2.6bn fund which is larger than most. What I meant by stick to the larger funds is more saying avoid the small, new whacky fund that is being set up by a couple of people who are experts in the property market in Milan and is promising guaranteed gains of 40%pa but has no track record. The rules governing investment trusts and unit trusts are stricter than the rules for a fund set up by a small high street business. If you are using the tables in Money Week and other publications from time to time, they exclude the whacky funds and should only list funds that are honest about past performance and the risk particular to each fund. As long as you are realistic about expectations, you wont go far wrong.
    • Post Points: 5
  •  Tue, Jan 08 2008, 5:09 PM

    Re: 20k to invest

    Hi maxstream - you mentioned larger unit trusts and investment trusts, would you mind letting me know what that means?

    I totally agree with you about not putting everything in one place. A lot of the times it is really about who to trust & who have good intentions, and distinguishing them from those who are just trying to take your money whether it be fee charges, commissions etc.

    Thanks for the IC mag tip - I got myself a copy of Money Week and its like learning a new language.

    • Post Points: 20
  •  Tue, Jan 08 2008, 3:46 PM

    Re: 20k to invest

    It's not a case of either a savings account or stocks. There is nothing wrong with splitting the sum between savings accounts with handy banks or building societies and putting the rest in a selection of unit trusts or investment trusts. Some funds have higher risk than others - small companies or emerging markets are generally regarded as high risk while blue chip UK stocks are low risk. The best way to see what could happen to your money is to look at a chart of some stock indeces. The footse index of the 100 largest UK companies is currently about 3% lower than it was 3 months ago, 9% lower than 6 months ago, 3% higher than 1 year ago, 11% higher than 2 years ago, and 60% higher than 5 years ago. If you can put up with those sort of fluctuations, then you should certainly consider investing part of your money into a fund investing in large UK companies. You should not put the whole amount into one savings account or one investment fund. Beyond that advice, you need to make your own decisions about how much risk you want to take and who you are willing to trust to handle the money - it is worth restricting your stock investments to larger unit trusts and investment trusts though and there are plenty of those to choose from.

    One investment I would recommend is spending a few pounds at your newsagents on next week's Invertors Chronicle.

    • Post Points: 20
  •  Tue, Jan 08 2008, 3:20 PM

    Re: 20k to invest

    Glad to help.

    My advice would be to go to a specialist - a financial planning advisor. They can give you everything, tax implications, options - they will take into account you and your needs.

    But yes, stock term (for growth) I think should be ideally 5 years +.

    good luck and happy investing.

    beausian

    • Post Points: 5
  •  Tue, Jan 08 2008, 2:35 PM

    Re: 20k to invest

    Hi beausian, thanks for letting me know. I am enlightened! How would you invest 20k? And when you say stick term needs to be lower, how long are you talking.... 5 years? The thing is, savings account doesnt give a lot of interest back which is why I am looking at stocks...
    • Post Points: 20
  •  Tue, Jan 08 2008, 2:21 PM

    Re: 20k to invest

    Hi

    I am not an expert, I can only tell you what I have learnt. But the phrases low risk, stocks and 3 years max don't fit in the same sentence. If you want low risk, put it in a savings account. It's safe, you will get your money back with a bit of interest. Stocks/funds may not return you your full investment. And generally they need longer than 3 years (but there are some other very knowledgble people who may beg to differ and have some very good ideas.)

    Happy investing!

    beausian

    • Post Points: 20
  •  Tue, Jan 08 2008, 2:10 PM

    20k to invest

    Hi, I have 20k in cash to invest - preferably in a low risk market and rather it not be online based. I have no idea what to do as this money but do know I can put this money away for a period of 3 years maximum and wouldn't mind investing it into stocks/funds. Any advice would be appreciated. Thank you in advance.
    • Post Points: 35