Reply to: How would you invest £1m?

[DimPrawn]

People also can't see that governments worldwide are reducing the value of their currencies and hence the value of cash that the population holds is also be eroded. The last few years of QE and ZIRP will continue globally and what most don't realize is the impact this has on their purchasing power.

Of course, the worst affected are those who work hand-to-mouth i.e. own no assets but have to work to pay for their rent, food etc. Those with assets can ride the currency war wave to some extent, such as those who have invested in assets of any kind - stock markets, property being prime examples.

Ultimately governments are stealing your money from you without you even realizing. 'Paper' money is ultimately worth less and less (....worthless) because it isn't back by anything since the peg to gold was abolished in the 1970s. All un-backed currencies have failed throughout history because, guess what, they have no value apart from what the holder is prepared to entrust to them.

The only thing that will hold and gain value over generations, time and time again, is property - or rather, the land under that property. Yes, of course governments can take that from you too, as they can with anything, but it won't be until they have plundered your cash (though erosion and then a 'haircut' on your bank accounts) and taken your gold first.

Anyone I digress. Must go and get some lunch, seeing as the wife is calling for me (it's one of my chill out days today).

All true. Enjoy your lunch.

[ChimpMaster]

People also can't see that governments worldwide are reducing the value of their currencies and hence the value of cash that the population holds is also be eroded. The last few years of QE and ZIRP will continue globally and what most don't realize is the impact this has on their purchasing power.

Of course, the worst affected are those who work hand-to-mouth i.e. own no assets but have to work to pay for their rent, food etc. Those with assets can ride the currency war wave to some extent, such as those who have invested in assets of any kind - stock markets, property being prime examples.

Ultimately governments are stealing your money from you without you even realizing. 'Paper' money is ultimately worth less and less (....worthless) because it isn't back by anything since the peg to gold was abolished in the 1970s. All un-backed currencies have failed throughout history because, guess what, they have no value apart from what the holder is prepared to entrust to them.

The only thing that will hold and gain value over generations, time and time again, is property - or rather, the land under that property. Yes, of course governments can take that from you too, as they can with anything, but it won't be until they have plundered your cash (though erosion and then a 'haircut' on your bank accounts) and taken your gold first.

Anyone I digress. Must go and get some lunch, seeing as the wife is calling for me (it's one of my chill out days today).

[DimPrawn]

In a way, but the concept is valid. In technical analysis, the founding principle is that the price of a stock represents all the current combined knowledge about that stock. I'm not interested in buying the FT every day, researching companies, thinking "I bet they're going places, I'm gonna invest in them" as there are millions of people (insiders) out there that already have much more information than I could ever get (notice how a share price jumps a week or so before a co announces a big contract win?).

So there's millions of trades going on, probably mainly automated, and the idea is to invest in several stocks at a time, hold them for a few days, then automatically sell them if they reach say 7%, or sell half or whatever. Some will make a loss but hopefully the ones that make a profit cover your losses and also commission (hence the need for a large pot with which to invest, it wouldn't work with say £100 a trade as any tiny gains would be swallowed by the commission.)

My bluechip can't fail portfolio of:

British & Commonwealth Shipping
Ferranti
MFI Furniture
HMV
Polly Peck
Woolworths
Bradford & Bingley (shareholders got nothing)
Maxwell Communication Corporation (collapsed)
Railtrack (nationalised)

Didn't work out too well over the long term.

[LondonManc]

Doesnt' that just smack you as the modern equivalent of alchemy? Turning thin air into gold.

Simon Cowell's been doing it with hot air for years. hth

[rl4engc]

Doesnt' that just smack you as the modern equivalent of alchemy? Turning thin air into gold.

In a way, but the concept is valid. In technical analysis, the founding principle is that the price of a stock represents all the current combined knowledge about that stock. I'm not interested in buying the FT every day, researching companies, thinking "I bet they're going places, I'm gonna invest in them" as there are millions of people (insiders) out there that already have much more information than I could ever get (notice how a share price jumps a week or so before a co announces a big contract win?).

So there's millions of trades going on, probably mainly automated, and the idea is to invest in several stocks at a time, hold them for a few days, then automatically sell them if they reach say 7%, or sell half or whatever. Some will make a loss but hopefully the ones that make a profit cover your losses and also commission (hence the need for a large pot with which to invest, it wouldn't work with say £100 a trade as any tiny gains would be swallowed by the commission.)

[Scrag Meister]

Clear the mortgage
Nissan GTR
6 months touring around America
Motorcycle tour through Vietnam, Cambodia and Thailand.

Not sure about the rest.

When my mother died my father gave my brother and I some money, he paid it into his mortgage, my wife and I bought 2 motorcycles and disappeared around Europe for a month. Horses for courses.

[EternalOptimist]

I am having great difficulty investing 100k, never mind a million.


I suspect in ten years I will look back and say 'yeah. that's what I shoudaa done'

as usual

[pjclarke]

Doesnt' that just smack you as the modern equivalent of alchemy? Turning thin air into gold.

Pure snake oil. http://www.amazon.co.uk/4-Hour-Work-...113/ref=sr_1_1

[Waldorf]

How would you invest £1m?

The 10% is meant to be challenging and is a figure I chose because I am already achieving this from a property portfolio, which is part repayment and part interest-only. I need to ramp my investments up to aforementioned figures so that I have a better residual monthly income.

The £1m is a figure that at some point needs to be attainable and is large enough from which is invest and speculate (a little) to achieve the desired return.

I don't like the idea of stocks because dividend returns are paltry and I don't want to speculate stock prices.

A business would be great but I don't want anything that needs daily 'hands-on' effort.

It's a bit like asking, if you had £1m and could choose to retire (or choose to live your life free), how would you do it? Would you be happy putting it in the bank and have them pay you 1% interest while inflation whittles the worth of your capital away? Or would you use your balls and your creativity to push for the more rewarding ROI?

If you are achieving a 10% yield on property it is likely that the property is at the low value end of the market. This has the usual risk of higher maintenance costs, less reliable tenants, very low capital growth and low rental growth.

Of course from the rental income there are lots of costs such as maintenance, management, insurance, voids etc, so the actual yield will be much lower. Gross yield on quality property is more likely to be more like 4-6%, after costs you are getting to only 3-4%.

Yields on property and other general tracker funds can give you a yield of 3-4% at least, no costs, just tax to pay. This would give you a much greater prospect of capital and income growth with no hassle of management, voids etc together with a much greater quality of investment.

This will give you inflation proofing capital and income growth over the long term.

You said that you did not want to speculate on stocks but you seem to do so with property?

[tomtomagain]

Swing Trading. Something I've fancied researching and practicing but never got around to it.

A £1m pot would give you £10k per trade (max 1% per trade of total pot), so even if you sell at 3% higher than you bought, that's £300 -commission. i.e. a days contracting.

I love the idea of emotionless, automated trading; You get up in the morning, look at your 8 monitor rig where some scripts that ran overnight advise you on say 5 symbols to invest in (you don't care what they are, all you're bothered about is the patterns they are showing could show start of an up or possibly down trend, as advised by your script) then you go about your day and don't worry about it. You set rules to automatically sell if they fall or rise by a certain amount so there's no emotions like fear or greed that would kick in to affect decision making.

Like I say, it's a dream I've not fully researched but I like the idea a lot.

Doesnt' that just smack you as the modern equivalent of alchemy? Turning thin air into gold.

[d000hg]

Well clearly you buy ones that actually exist, somewhere that has a decent reputation.

[tomtomagain]

Best I've seen as "easy" is about 8% buying holiday properties abroad, but I have no idea how that gets taxed given it's in an EU nation with high taxation.

Even buying a £50k house and renting for £400pcm gives less than 10% BEFORE expenses.

Buying holiday properties abroad???? That's one of the oldest scams going. The easiest way to lose your money.

[d000hg]

I'd need more than a million to run the pub I want to run

A coffee shop in a seaside town isn't exactly country bumpkin either, more urbanite beach bum

I was thinking more a beach-side cafe than a modern coffee shop

[CloudWalker]

I hate to say it but BTL is the norm now.

[pjclarke]

If you want to start swing trading there won't be many better days than today, to start doing it.

The markets have just got completely hammered!

aka Buying opportunity. Just topped up with Glencore at 160p .....