Investing!

Any of yous do it ?
I am interested in it but don't have a clue!

 

I work in investments. What would you like to know?

 

How it works?
You buy part of a company ? And if they are doing well, you get money ?

 

I would like to buy some shares at a really low price and to sell them at a really high price, any up and coming companies need my investment

 

That right there should end your interest in it.

 

second that buy low sell high

 

Ever heard of learning ?

 

Rangers Football Club. If they fail you will lose money, but you will be happy anyway because they are gone.

That my friends, is hedging a risk.

 

I've always been really curious to how this works. I watched a tv show once were the couple invested $2000 into a company and each day they checked it, it was either higher or lower than their initial $2000 investment so whenever they thought it was worth it they'd sell the stocks and bank the profits.

This wasn't a documentary or anything just an american comedy show, but it is it really that simple ? Find a company - invest - then sell ?

 

You can buy equities (shares). So yes, you buy a tiny bit of the company and you benefit from the rise in share price and also any dividends the company pays. Or you can buy bonds, which is like a company IOU. You give them money then keep the bond over a certain period until you get paid back (plus profit).

Million other ways of investing but those are the fundamental investments

 

So how would someone go about doing this, the first step like ?

 

It can be that simple.

Say you bought Tesco yesterday. Today you would be 15% worse off as they issued a profit warning today and the market didnt like it. So more people sold than bought, hence the price went down, hence the value of the company went down.

If Tesco was to increase 100% over the year, each share you own would be worth 100% more than you bought. It is that easy.

Picking the winners sadly is not that easy...

 

I don't know much or have experience in this area either, although i think there are different types of investments in shares. As in long term investments and short term ones, i know a few people who have friends who invest in shares and do it on a daily basis. They would invest a certain amount wait for it to rise in value, sell immediately and move on to other companies. If you are good you can do it all day and get a reasonable profit one would assume.

 

You can set up an Investment Dealing Account online. You can do this through a million different platforms (Barclays is the biggest retail platform I think). You pay per trade you make.

Disclaimer: I am happy to give advise, but please please please do not go and invest money you cannot afford to lose on anything I say. You need to do a lot of research into what you want to achieve and the level of risk you want to take.

Happy to help but please keep that in mind

 

Consider the disclaimer understood.

Now let's say I were to invest £1000 in a company like or similar to Tesco that increased 100% over the year ( I know it's rare, but hypothetically speaking ) what would be my takings from that if I were to sell my shares/stake in the company?

 

It would be 100% minus dealing charges and the spread (the difference between buying and selling price). You can trade for about £10 a go so your profit would be £1000-£20-say £5 for spread, so £975 or thereabouts.

You are very unlikely to achieve 100% increase in mega-cap companies such as Tesco, but more than possible is much smaller companies. But equally, a far greater level of risk. Risk/return is what should drive ever investment decision you ever make

 

After reading those figures it seems very unlikely then that investment is a " get rich quick scheme "

Might as well leave investing to the big boys, who aren't out of their depth lol.

Thank for breaking all that down mate, got a better understanding of it now

 

No problem,

Keep in mind, most of the "big boys" cannot even beat the index over the long-term. Only a tiny few do, and it is very very difficult.

 

You're like a real-life version of my Finance textbook