New to forum, new to dealing

[Careful G]

Hi there

Title subject says all, I started trading about 6 months ago, learnt a few things, but a long way to go. I am using Hargreaves Lansdown to trade, and only dealing on the FTSE 100, mainly for income.

Action so far
1) bought 15 top shares to spread risk.
2) mainly high yields for income.
3) money used was previously in a building society with low rates.


Mistakes so far
Not understanding how/when dividends are earned/paid
Taking too much notice of broker tips, resulting in buying or selling at wrong time.

I now hear, that as long as I own the shares at time of dividend date, I will receive a dividend payment. Not knowing this, I sold shares and missed out.

MY REQUIREMENTS
I would like to invest in shares with a minimum yield of 4%, and hopefully, if I invest in the likes of names below, should I be able to keep them long term, and ignore concern if/when they go down, as they will always recover.

GLAXO
BP
UNILEVER
VODAFONE
RD SHELL
L/GENERAL
HSBC
N.GRID
BILLITON
SSE
BAE
U.UTILITIES
TESCO (at the bottom price)
M & S
What I am trying to say, I want to invest for income, and just leave them untouched, believing none of them could go bust, but if so, my risks were spread??

 

[timsk]

. . . What I am trying to say, I want to invest for income, and just leave them untouched, believing none of them could go bust, but if so, my risks were spread??

Hi Careful G,
Welcome to T2W.

T2W is a community forum primarily for traders - as opposed to investors. In spite of saying that you started 'trading' six months ago, it sounds to me as if you're more of an investor than a trader? The main difference being the length of time you hold on to your trades/investments. Most T2W members think in terms of minutes to a few weeks, occasionally a few months. Investors think in terms of many months to many years. If you're in the investor camp, you might like to consider joining a forum like Motley Fool.

As I'm writing, I'll offer my thoughts, but keep in mind I'm not an investor - so take what I say with a pinch of salt. Generally speaking, markets rise over time, as the whole economic system is geared towards growth. So, theoretically, blue chips like the ones you've listed ought - in theory anyway - to increase in value. However, any one of them could go broke. Being in the FTSE 100 doesn't prevent business failure: M&S being the most obviously vulnerable of the companies you've listed.

The difficulty with investing - and trading come to that - is market timing. Many technical indicators suggest (and have done for a long time) that the market is overcooked and is due for a correction, if not a full blown reversal. If you invest now in all of the companies in one hit and the market turns down from its all time highs, you may have to sit on your holdings for many years before it recovers and, hopefully, moves higher. That said, you'll still receive your dividend income - so maybe the actual share price is of no major concern to you?
Tim.

 

[SlowlyButSurely]

Hi CG,

I too have an account there and one thing that I noticed was the cost per deal (around £12). How is this affecting you?

This forced me to reduce the variety of shares I wanted to buy and hold and instead I chose 3 main ones in order not to get stung with crazy charges upon buying/selling. That said the cost is fixed I believe so if you are trading with a hefty balance then ignore me.

Shares I bought:

Lloyds
Diageo
Banco Commercial Portuguese

 

[CityMasterTrader]

Hi there

Title subject says all, I started trading about 6 months ago, learnt a few things, but a long way to go. I am using Hargreaves Lansdown to trade, and only dealing on the FTSE 100, mainly for income.

Action so far
1) bought 15 top shares to spread risk.
2) mainly high yields for income.
3) money used was previously in a building society with low rates.


Mistakes so far
Not understanding how/when dividends are earned/paid
Taking too much notice of broker tips, resulting in buying or selling at wrong time.

I now hear, that as long as I own the shares at time of dividend date, I will receive a dividend payment. Not knowing this, I sold shares and missed out.

MY REQUIREMENTS
I would like to invest in shares with a minimum yield of 4%, and hopefully, if I invest in the likes of names below, should I be able to keep them long term, and ignore concern if/when they go down, as they will always recover.

GLAXO
BP
UNILEVER
VODAFONE
RD SHELL
L/GENERAL
HSBC
N.GRID
BILLITON
SSE
BAE
U.UTILITIES
TESCO (at the bottom price)
M & S
What I am trying to say, I want to invest for income, and just leave them untouched, believing none of them could go bust, but if so, my risks were spread??

The names you have chosen are some of the highest yielding defensive stocks on the FTSE100 and your risk looks well spread. Dividends on shares are paid on the payment date and you have to hold the shares the day before they go ex-dividend (the day the share price drops in reaction). If you are only trading for income you could consider CFDs which allow you to take the same size position whilst only putting down a 5-10% deposit (using leverage), you don’t pay any stamp duty (quite a saving) and you have the benefit of receiving the cash dividend on the ex-div date (still need position open the day before) which allows you to profit from any recovery in the share price before physical shareholders receive their cash. Good luck in your quest for income. Maybe look at some of the other names out there paying north of 4%. You’d be surprised how many there are.