Investment
In its most basic form, investment is just about putting a few pennies in our piggy bank, as we were taught to do when we were wee. Sometimes it seemed hard to do, when there were so many other temptations around, but the concept of saving for a rainy day has stuck with most of us, and we realise we must put something by when we can, for those times when we cannot.
When we started saving, we hadn't yet realised that risk, as we understood it in relation to falling off a wall, could also be applied to other things, like savings and investment. When were climbing walls, we could choose a lower wall, with not so far to fall, perhaps a wider wall, where there was more protection against going adrift, or for most protection of all, we would rely on mum or dad to hold our hand, that was when we knew we were really safe.
We can help you find the investments with as far to fall as you are prepared to risk, with as wide a scope for variation as you want, and metaphorically anyway, we will hold your hand along the way.
You will still fall from time to time, but we will try to stop you being hurt more than was necessary, bearing in mind the height of the wall you chose.
Our Services
We start by looking at your existing savings and investments, making sure you have enough rainy day money kept aside in cash savings for eventualities and planned events you have identified. There may be scope for moving some of this money between bank and building society accounts, cash ISAs, and National Savings to earn some decent returns, while minimising any risk.
When basic needs have been taken care of, we would then look at the wider range of investments available for existing funds and methods of saving to build up additional savings for the future. Everything depends of course on your attitude to investment risk, you may not want to take any stock market related risk at all, or you we may be happy to invest in the developing economies at the other end of the risk scale, such as India and China.
Somewhere along the scale, there are investments for you, and we will recommend which we think may suit you. They may well be things you hadn't thought of. For example, how many people know they could save on a monthly basis into Premium Bonds by standing order, or directly into unit trusts, held in trust for a grandchild? Well, a few of our clients do, but apart from them?
It doesn't end there, of course, circumstances change, needs vary, time marches on and investment conditions and objectives must be reviewed, so we recommend regular reviews, to keep everything up to date.
|
Individual Savings Accounts Individual Savings Accounts, ISAs for short, are tax efficient investments with options to put your money into in cash and stock market based investments. You can have a mini cash ISA, holding only cash, a mini stocks and shares ISA for only stock market investments, or a maxi ISA, for either some cash, and some invested, or all invested in stock markets. |
Unit Trusts Unit trusts are pooled investments, usually in stock market based investments. The fund managers research suitable companies to invest in, within your chosen international market and market sector, he or she makes the investments and keeps his holdings under review, selling and buying other shares as market conditions and the progress of his individual stock selections change. |
|
Savings Bank and building society accounts offer protection from the fluctuations of other investments, such as stocks and shares, so the capital remains the same, with interest added.
However, there is an inflation risk, if the interest gained is not enough to cover the effect of inflation on the capital, or if the interest is used as income and is spent, then the real value of the money will be eroded in time by inflation.
This can be avoided by ensuring the money is always kept in an account paying more interest than the rate of inflation at the time, and only spending that part of the interest which exceeds the level of inflation. |
Investment Trusts  Investment trusts are limited companies, quoted on the stock exchange. Investors buy and sell the shares of the company and with the proceeds the managers buy shares in other companies.
They can also borrow money and buy more shares with the borrowed money, a process known as gearing.
There are therefore different factors to consider, the changes in the net asset value of the shares they have bought and the day to day trading of the investment trust shares.
These may either be trading at a discount or at a premium to net asset value, and the extent of gearing, which can increase both gains and losses on the assets. |
Top of page
About Us |
Site Map |
Privacy Policy |
Contact Us
The information on this website is intended for UK residents only We can still help you if you are non-resident, please contact us for further information
©1998 - 2008 The Scottish Financial Independence Group | Website design and management by
Omnial Group