I'm a 'Winner'

[the guy with the bowtie]

'Invested' £6k in Premium Bonds in Sept 2005. I have just received my first winners letter - I have won £50.

Does not fill me with a warm and fuzzy feeling. Am I luckless or a stupid investor ?

[MarillionFan]

I like the idea of premium bonds. SHould be part of a portfolio

[SallyAnne]

Am I luckless or a stupid investor ?

How much interest would you have by now if you'd put it in a bank or an ISA?

[MarillionFan]

Heavy night on the pop again SA?

[wendigo100]

Am I luckless or a stupid investor ?

The government have been pushing these hard over the past couple of years. This has told me three things:

1. The government desperately need your money

2. Premium Bonds are a crap investment

3. Alan Sugar is a Labour Luvvy

[TheOmegaMan]

Well you miserable bunch of fu*kwits, here begins the lesson - premium bonds are a form of investment with a stochastic rate of return. You are not a winner, you are merely getting some return. However, the return from premium bonds (through winnings) is on average less than that from risk-free investments even though you are taking on risk. Thus they are for numptys, fu*kwits, and simple-minded IT contractors.

[Buffoon]

... premium bonds are a form of investment with a stochastic rate of return. You are not a winner, you are merely getting some return. However, the return from premium bonds (through winnings) is on average less than that from risk-free investments even though you are taking on risk...

He's right you know. I was going to say the same thing but Mr Omega beat me to it. The bit about being worse than the RFR is very true and getting worse from next year the nominal rate on premium bonds goes down to 3.4% in the face of further rises in bank rate. Something else that el Gordo forgot to make public.

[MarillionFan]

Nah. You two are having a laugh.

Premium bonds are a little bit of fun. Its a lottery whereby you actually return a little cash. Doing the lottery is stupid, doing premium bonds a little fun.

But then again boys when you're as poor as you two sticking a fiver in a savings account seems like a good idea.

Now where did I park my wallet?

[ChimpMaster]

Yes but they sell it on the fact that all income is tax free and that there is a [very] small chance of winning a much bigger prize.

[Denny]

My ex-builder told me that he knew of someone who maxed out his PB allowance by having £100K worth. He regularly gets a good return on his winnings......apparently.