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I want to Buy Shares.

  • 27-05-2014 7:41pm
    #1
    Registered Users Posts: 55 ✭✭


    Hi, I have €5,000 and I would like to buy some shares in something just to see if I could make a few bob. I have never had a share in anything and I haven`t a clue as to how to buy a share or sell one. I would like to do all of this Online and it was said to me that maybe I should look at the American or British markets. I would really appreciate some advice and direction on this.


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Comments

  • Registered Users Posts: 1,094 ✭✭✭househero


    Seaniemac wrote: »
    Hi, I have €5,000 and I would like to buy some shares in something just to see if I could make a few bob. I have never had a share in anything and I haven`t a clue as to how to buy a share or sell one. I would like to do all of this Online and it was said to me that maybe I should look at the American or British markets. I would really appreciate some advice and direction on this.

    My advice to you.

    Is don't do it.

    You have no idea. Go do some research for 3 years. Play with fake money on a real stock exchange (most big sites have these fantasy portfolios) then you Will a. Realise the market is not great for beginners right now. B. Easy to loose money. C. Hard to make it.


  • Closed Accounts Posts: 1,004 ✭✭✭Recondite49


    Seaniemac wrote: »
    Hi, I have €5,000 and I would like to buy some shares in something just to see if I could make a few bob. I have never had a share in anything and I haven`t a clue as to how to buy a share or sell one. I would like to do all of this Online and it was said to me that maybe I should look at the American or British markets. I would really appreciate some advice and direction on this.

    Hi buddy,

    When I wanted to get started I visited the Investopedia website which has some great intros and an imaginary stock market simulator which I found really useful.

    If you want to learn a little more about Financial Theory in general, MIT Openware does a great free course using video lectures, which I'm taking at the moment, it's really useful when it comes to learning about stocks, bonds, equities etc. That way you can learn about different investment instruments and see what works for you. For instance you might want to buy government bonds which are very safe but don't offer a very high rate of return.

    A couple of books I really enjoyed too were, "Rich Dad, Poor Dad" (more to do with becoming financially independent in general terms, "A random walk down Wall Street" and "Beating the Street" by Peter Lynch.

    Probably the best way to learn though is to try joining an investment club if there's one in your area (or start your own!) that way you can learn from each other and also save on commission when buying shares through doing it together.

    Naturally if you have any further questions feel free to come on here. Best of luck with your investment.


  • Registered Users Posts: 1,580 ✭✭✭Voltex


    OP..try out virtual trading platforms first. Bullbearings.co.uk is pretty good.


  • Registered Users Posts: 29 tennisfennis


    househero wrote: »
    My advice to you.

    Is don't do it.

    You have no idea. Go do some research for 3 years. Play with fake money on a real stock exchange (most big sites have these fantasy portfolios) then you Will a. Realise the market is not great for beginners right now. B. Easy to loose money. C. Hard to make it.

    This is the BEST FREE advice you can hope to ever get. Please follow it


  • Registered Users Posts: 1,094 ✭✭✭househero


    This is the BEST FREE advice you can hope to ever get. Please follow it

    & I hope he did. DOW down nearly 5% in 3 weeks and looking unhealthy going in to the summer lull. Would have been a great way to watch the market falling (with imaginary money). Instead of loosing his hard earned money to a frothy market.


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  • Registered Users Posts: 55 ✭✭Seaniemac


    I took all the Advice and I didn`t buy. I think I might drink it instead ;-)


  • Registered Users Posts: 327 ✭✭userod


    Amazing noone here can ever give a straight answer on how to buy a few shares. Are ye all a little lost or what?


  • Registered Users Posts: 5,834 ✭✭✭Sonnenblumen


    userod wrote: »
    Amazing noone here can ever give a straight answer on how to buy a few shares. Are ye all a little lost or what?

    You have the stage, let's hear it from you or do you also have Kindergarten Q's? :(


  • Registered Users Posts: 55 ✭✭Seaniemac


    You have the stage, let's hear it from you or do you also have Kindergarten Q's? :(

    I wouldn`t consider my question a "Kindergarten Q" as you put it. If you haven`t anything civil to say, don`t say anything at all.....


  • Registered Users Posts: 213 ✭✭tommylimerick


    the first share I bought instead of going drinking or buying a car turned into a five bagger
    it could have gone higher but the shareholders ****eed it up
    I say op you are young and can ttake more risks than a pensioner might
    that is why a pensioner would have a lot more of their money in bonds than shares
    so you should go high risk in a technology company or something that takes your eye in the next couple of months
    I invest in companies sometimes where I have had a good experience or new product


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  • Closed Accounts Posts: 1,004 ✭✭✭Recondite49


    Seaniemac wrote: »
    I wouldn`t consider my question a "Kindergarten Q" as you put it. If you haven`t anything civil to say, don`t say anything at all.....

    Hi Seanie,

    I've started a suggested "Broker Review" thread here in the Investment and Markets forums. I haven't posted in a while as I've only just set up an account with the Belgian bank Keytrade and am still waiting to hear from TD Direct Investing who apparently mistakenly refused my application and are happy to let me open an account.

    I think the main difficulty for anyone getting started are that you need to have an understanding of basic financial theory to have an appreciation of risk and you need to get some money together to invest in the first place - naturally you've taken care of the latter of the two! :)

    As I'm sure you already know, the level of return on investment is usually commensurate with the level of risk.

    If you're still in your twenties like me (barely! :-D) then I would suggest putting 20% into bonds and 80% into shares. Personally I split my money equally between Vanguard index funds - you can google these if you like.

    In a nutshell, Vanguard operates on a not for profit basis and therefore the cost to you of buying shares in one of their ETF's are fairly minimal. They do have ones which follow government bonds which of course are safe, given that the government can simply print more money or raise taxes to pay them off rather than default.

    This is a mechanical and fairly boring way to invest but if you do have a read of 'A random walk down Wall Street' you'll see that investing in a broad index fund over the years has proven a far better return on your investment than sinking your money into this or that mutual fund.

    Naturally, this is a way of growing your wealth in the long term but if like me you want to retire at 60, you do have some time on your hands to play around with.

    If you do ever change your mind and want to open a brokerage account, feel free to have a look on the forums or send me a message.


  • Registered Users Posts: 5,834 ✭✭✭Sonnenblumen


    Seaniemac wrote: »
    I wouldn`t consider my question a "Kindergarten Q" as you put it. If you haven`t anything civil to say, don`t say anything at all.....

    I was actually quite civil, I probably just have a low tolerance of piss artists, tyre kickers etc


  • Banned (with Prison Access) Posts: 8 sugar_lover


    Seaniemac wrote: »
    Hi, I have €5,000 and I would like to buy some shares in something just to see if I could make a few bob. I have never had a share in anything and I haven`t a clue as to how to buy a share or sell one. I would like to do all of this Online and it was said to me that maybe I should look at the American or British markets. I would really appreciate some advice and direction on this.

    if i were you i would buy an index fund , look up this one

    VEUR , its an index which covers europe , european stocks are better value than american ones right now


  • Registered Users Posts: 777 ✭✭✭dRNk SAnTA


    Listen - not that I'm disagreeing with anything that's been said on here, but please don't take your investment advice from people on forums talking about value. Do your own research and come to your own conclusions.

    When I started out I didn't have a clue either, and the reason people like us have a hard time figuring it out is because it's obviously so difficult to get a straight answer - look at this thread - someone asks "how do I buy shares", and it's 12 posts before the word "stockbroker" is mentioned.

    To ANSWER your question -

    You'll need a stockbroker to purchase shares or ETFs. These come in many forms - the large banks, well known brokerages such as Goodbody's, Davy's etc, or online ones. They have a range of different costs and service offerings - cheap online brokers are purely "transactional" - i.e. they'll give you no advice on what to do, whereas "goldplated", "bricks & mortar" stockbrokers will offer guidance (often at a hefty cost).

    Most cheap online brokers (e.g. based in UK/Europe/US) don't allow Irish customers, so the choice is relatively few and there are many threads on here debating the merits of each.

    Not all stockbrokers offers access to every stock/fund/exchange, so check that the stock you wish to buy is actually available before signing up.

    The next thing to be aware of is currency - you have euros, but US stocks are bought in dollars, UK stocks in sterling, etc. Stockbrokers will change your currency for you - but for a fee. You are best off planning and managing this yourself.

    We are all investing/trading because we want to make money so my main advice would be - watch your costs. These can easily eat up profit (if there is any!) and make all of your efforts a waste of time.

    Investopedia is a great resource, as others have said. I also read "monevator" and "bogleheads" as they fit with my personal strategy.

    Other than that - be careful and god speed!


  • Registered Users Posts: 537 ✭✭✭topper_harley2


    Hi Seanie,

    If you're still in your twenties like me (barely! :-D) then I would suggest putting 20% into bonds and 80% into shares. Personally I split my money equally between Vanguard index funds - you can google these if you like.

    In a nutshell, Vanguard operates on a not for profit basis and therefore the cost to you of buying shares in one of their ETF's are fairly minimal. They do have ones which follow government bonds which of course are safe, given that the government can simply print more money or raise taxes to pay them off rather than default.
    .

    I've been looking to try and get into the Vanguard index funds, due to them having traditionally low fees, VOO or VUSA i.e. S+P 500 trackers. Am I right in saying you cant actually buy them directly from VG, you need to buy them from broker, say TD Waterhouse online? What platform would you recommend for buy and hold investment in index funds, in order to minimise transaction costs?

    Thanks


  • Banned (with Prison Access) Posts: 1,934 ✭✭✭robp


    I've been looking to try and get into the Vanguard index funds, due to them having traditionally low fees, VOO or VUSA i.e. S+P 500 trackers. Am I right in saying you cant actually buy them directly from VG, you need to buy them from broker, say TD Waterhouse online? What platform would you recommend for buy and hold investment in index funds, in order to minimise transaction costs?

    Thanks

    Buy and hold people often prefer to reinvest ETF dividends but Vanguard funds do no reinvest dividends. For this you need alternatives like iShares. Fees are coming down in Europe but still they are much higher then the US.


  • Registered Users Posts: 537 ✭✭✭topper_harley2


    Aw, that's a pain alright re: dividend!

    Looking at http://www.ishares.com/global/, Ireland isn't listed as a local site.........can we still buy iShares ETFs via an online broker?


  • Banned (with Prison Access) Posts: 1,934 ✭✭✭robp


    Aw, that's a pain alright re: dividend!

    Looking at http://www.ishares.com/global/, Ireland isn't listed as a local site.........can we still buy iShares ETFs via an online broker?

    I am a complete beginner at this too but I have just opened a TD account and I am pretty sure that using TD you can purchase the S&P 500 with the ETF iShares Core S&P 500 UCITS ETF (CSPX). However only when traded on the London Stock Exchange. I don't know if that is an issue or not.


  • Closed Accounts Posts: 1,004 ✭✭✭Recondite49


    I've been looking to try and get into the Vanguard index funds, due to them having traditionally low fees, VOO or VUSA i.e. S+P 500 trackers. Am I right in saying you cant actually buy them directly from VG, you need to buy them from broker, say TD Waterhouse online? What platform would you recommend for buy and hold investment in index funds, in order to minimise transaction costs?

    Thanks

    Hi Topper,

    God bless you son, pleased to know there are some investors out there with the sense to let their wealth grow steadily.

    I have to be frank and say I'm still dealing with opening my account with TD - However from looking at their website's trading platform it would seem that it is possible to buy into Vanguard ETF such as VUSA - however only those traded on the London Stock Exchange.

    This isn't the end of the world but it does mean you'll have to pay 2% commission each time you want to convert your Euros to Sterling. Of course a conservative investor might favour the pound over the Euro but let's not get into that now.

    I have opened an account with the Belgian bank Keytrade and so far couldn't be happier. In exchange for a mere photocopy of my passport and bank statement I have a fully fledged current account along with one of those two factor key fob things (I've always wanted one of those!).

    They also provide you with a trading account. I've examined their trading platform and you can buy into all the Euro denominated Vanguard funds listed on the Amsterdam Stock exchange - the ones I would keep an eye on are VUSA and VWRL (the latter representing the rest of the world's stock markets. There are no Vanguard government bond ETF's there but iShares do have them, I forget the exact Ticker symbol but can dig this out for you if you'd like.

    What I like about Keytrade is the fact they don't charge any annual maintenance fees for you to hold shares, plus their commission on trades is a very reasonable EUR 14.95 - that said I think it's best we all compare our experiences with respective brokers as there are no doubt advantages and disadvantages to each.


  • Registered Users Posts: 537 ✭✭✭topper_harley2


    Great reply! Keytrade does sound good from your reply, especially the no annual fees to hold shares, compared to €15 at TD. Keytrade are part owned by Credit Agricole, a large French bank, it seems.

    I guess most/all of these online brokers hold the shares in nominee accounts. This is another consideration, based on the W&R Morrogh case a few years ago in Cork. I guess the only 100% safe method is holding share certs yourself.

    Do Rabo offer any ETFs? I know they offer managed funds, which they seem to be pushing via the regular investment approach. IMO you'l get killed by charges on this though.


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  • Banned (with Prison Access) Posts: 1,934 ✭✭✭robp


    Hi Topper,

    God bless you son, pleased to know there are some investors out there with the sense to let their wealth grow steadily.

    I have to be frank and say I'm still dealing with opening my account with TD - However from looking at their website's trading platform it would seem that it is possible to buy into Vanguard ETF such as VUSA - however only those traded on the London Stock Exchange.

    This isn't the end of the world but it does mean you'll have to pay 2% commission each time you want to convert your Euros to Sterling.
    This can be reduced quite a lot by thriftiness. With a website like TransferWise it will only cost you 0.5% to convert currency. Also, just because something is traded on the London Stock exchange doesn't mean it is automatically traded in Sterling. That been said I have not found any promising ETFs tracking the S&P 500 in Euros on the London tock Exchange. The one I mentioned earlier is in dollars. However you can get low fee ETFs tracking Eurozone stocks on the London Stock Exchange in Euro.


  • Closed Accounts Posts: 1,004 ✭✭✭Recondite49


    robp wrote: »
    This can be reduced quite a lot by thriftiness. With a website like TransferWise it will only cost you 0.5% to convert currency. Also, just because something is traded on the London Stock exchange doesn't mean it is automatically traded in Sterling. That been said I have not found any promising ETFs tracking the S&P 500 in Euros on the London tock Exchange. The one I mentioned earlier is in dollars. However you can get low fee ETFs tracking Eurozone stocks on the London Stock Exchange in Euro.

    Hi Rob,

    Thanks for your post.

    I hadn't heard of transfer wise before but they seem ideal for sending money abroad. If your broker accepts third party transfers into your account (as naturally it won't be in your own name) and they have a Sterling denominated account you'll be quids in.

    As T D are British I certainly don't think it would be a problem to wire them pounds.
    That said, do you think it just might be deferring the foreign exchange costs for when you cash out your shares? Then again maybe Transferwise will be able to help then as well?

    I take your point about Euro dominated stocks on the London Stock Exchange. All I can talk about are the Vanguard funds I found on TD's website which were all in Sterling.

    I don't mean to put anyone off as a long term investor might well want to place their trust in the stability of the pound over the Euro in any case.

    Hoping to make my first purchase with Keytrade at end of month but will also open an account with TD just because.

    Will let you all know how it goes.


  • Registered Users Posts: 11 rekhib


    Just a few tips for the OP.

    - Generally, avoid buying US based ETFs/funds. Only reason to do so is if you can't get it anywhere else or if the bid/ask spread is too large anywhere else. You'll get hit with a 30/15% withholding tax and they won't reinvest your dividends. E.g. VOO tracks S&P 500 and while it's huge and liquid, you can find UK based equivalents that will 1) do the same job 2) reinvest your dividends and 3) be available in currencies other than USD.

    - You can buy direct from Vanguard if you have £100k/$100k but otherwise you gotta use a broker like TD.

    - Vanguard do reinvest dividends in some cases. Not reinvesting dividends is a feature of the US, not Vanguard. E.g. Vanguard UK's mutual funds (index trackers) are capitalising - need an overseas resident account from TD UK to buy them.

    - You can buy iShares ETFs US or UK based from TD Ireland - usually 2 versions on London, local currency (GBP) or base currency (USD) - try buy base currency if possible otherwise you'll be subject to uncontrolled currency risk.

    - Avoid transferring EUR into your brokerage a/c and using their FX service - send an FX transfer from your bank to their GBP/USD accounts - it'll save you a small fortune.

    Hope they're of some use.


  • Closed Accounts Posts: 1,004 ✭✭✭Recondite49


    Further to my previous post:

    As mentioned before I think it's a good idea to invest a proportion of your portfolio in government bonds, depending on your age. (The idea being to move from less risky investments with higher potential return to safer investments as time goes on.)

    I can't say which is the best but currently I have my eye on an iShares ETF which tracks 5-7 Year European Government Bonds (mostly French and German).

    Vanguard also have a GBP denominated Exchange Traded Fund which deals exclusively in UK Government bonds.

    These are very boring but also very low risk, as there's no reason for the government in question to default on its debts when they control the machines which print more money. Of course the safety means also only a fairly minimal return on your investment and there's no guarantee you'll even beat inflation.

    If you're starting out I'd suggest putting 10% of your portfolio into Government Bonds and the other 90% into an Exchange Traded fund either tracking developed European Countries or America's S&P 500.


  • Registered Users Posts: 213 ✭✭tommylimerick


    yes but in Ireland we do not control our printing presses yet we guarantee bonds of irish banks
    with most bonds you will find it hard to beat inflation


  • Closed Accounts Posts: 1,004 ✭✭✭Recondite49


    yes but in Ireland we do not control our printing presses yet we guarantee bonds of irish banks
    with most bonds you will find it hard to beat inflation

    One of the prices we pay for being part of the Eurozone sadly!! However, the government can also issue more bonds or raise taxes to avoid defaulting too.

    As I understand it this so-called Universal Social Charge was levied to bail the banks out - such a shame to see good money going after bad.

    At the moment I am planning to put 20% of my portfolio into bonds but as we discussed above as time goes on, we all become more risk averse so it's best to have government bonds form a greater part of your investments as time goes on.


  • Closed Accounts Posts: 685 ✭✭✭FURET


    The OP should buy broad-based ETFs - but only if he intends to hold them for a long period and can get around to seeing a rising market as a bad thing and a falling market as a good thing for the long-term investor.

    He should also read some basic but essential books - The Intelligent Investor being the most important.

    For someone aged 30, an allocation as follows might make sense:

    30% short term government bond ETF
    35% S&P 500
    35% Developed Europe or World stock market ex-US

    Non-Americans should avoud buying off US-based exchanges due to the US death tax.


  • Closed Accounts Posts: 1,004 ✭✭✭Recondite49


    FURET wrote: »
    The OP should buy broad-based ETFs - but only if he intends to hold them for a long period and can get around to seeing a rising market as a bad thing and a falling market as a good thing for the long-term investor.

    He should also read some basic but essential books - The Intelligent Investor being the most important.

    For someone aged 30, an allocation as follows might make sense:

    30% short term government bond ETF
    35% S&P 500
    35% Developed Europe or World stock market ex-US

    Non-Americans should avoud buying off US-based exchanges due to the US death tax.

    From your lips to God's ears FURET, nice to see someone giving sound investment advice! :)


  • Registered Users Posts: 777 ✭✭✭dRNk SAnTA


    Out of interest, has anyone looked into.

    - Vanguard FTSE Emerging Markets UCITS ETF - VFEM
    Primarily invested in China, Taiwan, Brazil, India, South Africa, Russia stocks.

    I'm considering adding a riskier ETF to my portfolio. Also, if anyone can recommend a similar capitalizing/accumulating ETF, I'd be very interested to hear about it.


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  • Registered Users Posts: 11 rekhib


    dRNk SAnTA wrote: »
    Out of interest, has anyone looked into.

    - Vanguard FTSE Emerging Markets UCITS ETF - VFEM
    Primarily invested in China, Taiwan, Brazil, India, South Africa, Russia stocks.

    I'm considering adding a riskier ETF to my portfolio. Also, if anyone can recommend a similar capitalizing/accumulating ETF, I'd be very interested to hear about it.

    What about SPDR's SPYM (large-cap) or SPYX (small-cap) emerging markets. Both can be purchased on LSE in either GBP or USD and they're capitalising.


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