Looking at buying Shares

[lennon]

Completely new to this but was looking at purchasing some shares in Lloyds TSB and BP.

Am I crazy? Should I be looking at others?


Advice please. Thanks CLennon

[wtaylor]

If your just starting try penny shares first until you get an understanding of what happens. Do your research!!! Have a look at www.shareprice.co.Uk and have a look at the shares your interested in and any patterns, also don't believe everything in the discussions

[hxbro]

Yes, never believe anything any writes, back it up with your own research, it's taken me months to finally understand one of my shares fully and what they are up to!

I did however jump in fairly blind following tips/popular shares mentioned on a couple of forums, small amounts of cash that I could spare to see what happens really, understand how to buy/sell, fee's, Stamp duty, capital gains tax, ISAs etc. I created a spreadsheet to help work out how much the price rises to make profit (in most/all cases you'll buy and instantly be down due to fees and stamp duty, and never been able to sell higher than you bought).

If you want some pointers on what to look at, feel free to ask, then look at the company websites, read RNS's to see what the company is up to and what stage, read boards (iii has one per share) to see the general feeling (popular shares will get a lot of ramping/deramping, so don't take everything said as true).

Ask yourself, am I investing or trading and is it short/medium/long term to make profit, set yourself SP (share price) targets and try not to worry about daily/weekly fluctuations in price on shares waiting on RNS's/news to be released (most aim shares will drop on no news, and rise towards news, and if news is good rapidly after news). Depending on how much you are investing you might need to set higher SP targets to take into account trading fee's on selling.

I wouldn't set stop losses, a "tree shake" where the MM (market makers) drop the price suddenly could cause the stop loss to happen meaning you lose money, then the price rises again within an hour and you end up re-buying at a higher price. Feel free to set limit orders to sell out for your target SP, this has the advantage of you could get the price you want (it's not a guarantee you will get that) but would mean you don't need to keep an eye on things.

[evilsatan]

Just a quick recommendation for a stockbroker. I recently moved from Hargreaves Lansdown to TDWaterhouse. TDW offer a vast array of tools and options which at first will seem daunting, but as you get used to it you will appreciate the additional options. They have a very competitive dealing charge and you can set limit buys etc.

Read the sticky posted by Spenny as it covers a lot of the lingo and techniques.

[hxbro]

I use iii, mainly because they are one of the cheapest £10/trade. I have a trading account, an ISA and Level 2 with them. Last week I applied for a TDW account, want to take advantage of the T10/T20 on a few shares over the next few months, might consider switching the trading account over if it works out better than iii.

[blacksheep]

As someone who's brother used to work for TDW until a short while ago I really wouldn't recommend them