Cheap Share Trading

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John_Jo

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Hi Folks, I currently have approx 30K in a deposit account making about 3% in interest.
I am considering diversifying into shares but need some advice. I want to invest 10K in 2 or 3 shares. I have the relevant ones in mind; they are quoted on the ISEQ, NYSE or London SE. What is the cheapest way to buy and hold shares (online) and what are the tax/other financial penalties involved? I see many traders advertised but not sure who to trust. Thanks for your help. John (31)
 
JohnJo, take it from me when it comes to Investments the only person that can be trusted is yourself. If you want to learn about shares I think it a good idea to learn about the business before yiou jump in at the deep end and lose your money.

And as for investment funds, give these a wide berth until the Financial Regulator has tackled this segment, torn it to shreds and put dome manners on the institutions who are ripping off Joe Public by simply not advising them of the hidden annual and full costs of the Investments.
 
I have used a few online brokers over the years and I believe you could do worse bearing the following factors in mind.

  • Length of time in business and are they backed / owned by a large institution. Remember brokers go bust too, are you covered if they do.
  • Transaction Fees, Management Fees, Monthly fees, Inactivity Fees. You should only pay the first, never any of the others. The size of the Trans fee isnt that important if like me you are buying to hold for years.
  • Ease of getting money into the account and back into your bank account. Bear in mind the last part particularly with US online brokers, if you are setting up a joint account with spouse.
  • Can they give you a Euro based cash account. If you are conservative sometimes you will want to sell and hold the balance in cash. If cash held in £ST or $US you are taking a risk on currency changes.
Most online brokers allow you to set up an account and buy & sell shares with pretend money. This would be a good idea to become familiar on how to buy & sell before using the real stuff.

I have used mytrack.com - US based $ only
and Saxobank.com - Denmark and London € accounts possible.
Both excellent - I prefer Saxo

Taxes are

  • Capital Gains Tax, payable at 2 periods towards the end of the calendar year only when you SELL for a PROFIT. 25% of Profit.
  • Set up your broker account with your spouse and double your Cap Gains tax free allowance.
  • Income Tax on dividends from held shares at your marginal rate
  • DIRT on interest from cash deposits - dont know rate
  • Stamp Duty 1% on Shares bought out of Irish Stock Exchange, 0.5% on shares bought out of any UK Stock exchange. Charged to you by the online broker at time of purchase. There are no sale taxes.
Education ie buying and selling smart. Massive impact on your returns.

  • FT on a Saturday - Money section. Widens the mind with accessable articles.
  • Books - there are so many - I couldnt recommend all
  • Courses. In Ireland there is "invest with the best" - no experience. TICN - I have done most courses. The basic course is logical and prudent. The other more advanced courses contradict the initial prudence of the 1st course. New boy on the block is iseinvest. I know the boss and I havent sat the course so I cant comment.
Sinn e. All the best
 
From someone who has won and lost. Only invest what you can afford to loose. A few months ago I would have sworn by Oil investments. Now look at PB.
3 years ago the Banks were the guilt edge of investments for security?
There is no predicting the future.
At the moment Johnson and Johnson are very low - by comparison to their usual price. worth a try!
Good luck, if I was young enough to allow reasonable time,5- 9 years I would still invest.
When your stock rises and there is good profit - do cash in. You can re-invest again when they drop - and they do drop.
Look at CRH we have held some of their shares for years, but missed the boat in cashing them in. Best of luck Browtal
 
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