Personl investor: How to Invest in S&P500

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Glenbob

Registered User
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Hi Guys,

I'm totally new to investment.

Usually I save €1500 P/M in a AIB Saving Acc but the interest is not great. I would now like to invest my monthly savings in the S&P500.

1. Do I need to go though a broker such as Davey or IG?
2. Can I invest in the S&P500 Direct - if so how?
3. I'm NOT looking to buy and sell quick rather this will be long term investing - is there best practice as to when is the best time to buy?
* I've looked into ETF's. Seemly I don't invest in the S&P500 rather their investment tracks the S&P stock price (I have a feeling this is the route I should take).
* I've also looked in Vanguard and tried to sign up to their site but can't because I don't have a SSN number.

Anyhow, advise would be greatly appreciated and MOST IMPORTANT how do I go about investing in the S&P500. Web links to investing in the S&P500 would be helpful.

Thank you,

Glen
 
Hi Glenbob,
No real problem about investing in S&P 500 , I agree with you that an ETF seems ideal, because of the low management charges , and Vanguard seem an excellent company.
You would need a Broker . I use TD Waterhouse ( [broken link removed] ) , and find them very good. They charge € 20 per buy or sell, and a quarterly charge if your stock holding with them is less than € 5000. They have no problem with buying any Vanguard ETF you may require.
I can give no advice as to best time to buy ( I wish I could !). You seem in a position to make a purchase ever month, which would average out purchase costs , and as you intend to hold long term , seems a very good method.

May I end on a note of caution, as you say you are totally new to investing.
A very basic principle of investing is to diversify in to various asset classes, such as shares, bonds, property, and cash. E.G. "not all eggs in one basket".

It is your money ( and your risk !) so only you should decide how much you should allocate to each class. S&P500 have done quite well recently , but there can be no guarantee this progress will be maintained. Generally , the trend should be upward, and as you intend to hold long term you should be happy with S&P500 --- but I would be wary of too much exposure to any asset class.

I would suggest investing some of your monthly savings into S&P500 , and investigating some other asset classes for the rest . give details of lots of other asset class ETF's, and is good for information. Don't forget that most of the web sites that offer information are trying to sell you something.


An excellent starter book ( although a bit old ) is "A random walk down Wall Street" by Burton Malkiel . Reading the posts on AAM is also very informative.

Finally may I wish you every success in your investment decisions. Nodo.
 
Hi Nodo,

Thanks for the reply and useful links & Book. I just signed up to tddirectinvesting.ie I'm pretty certain this is the type of site I was looking for because I was not sure how to purchase shares.

Thanks for the note about having a diverse portfolio - I do intend to have a varied investment strategy but for the time being I want to purchase S&P500 then go from there!

Kind Regards,

Glenbob
 
Property is essentially the same as equities. property, like businesses (equities) need a prospering economy in order to deliver decent returns over time. In other words, both property and business are dependent, to a significant degree, on upward progress in the underlying economy.

In contrast, gold, long-dated government bonds, bank deposits and hedge/absolute return strategies can all deliver returns above inflation without any correlation or dependence on the underlying economy.

Hence, the four original asset classes are equities (which includes property), precious metals, government bonds and bank deposits. Hedge/absolute return strategies (and funds that adopt them) are the latest asset class, although some disagree that the latter is an asset class at all.

Rory
 
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