Investing?

[Mid Boss]

Can someone kindly explain investing to me? I've been trying to look at bonds, savings accounts, stocks, etc and this is the conclusion I've come to so far...

It's all bull shit. Don't even bother with the stock market. It's rigged. You'll never win. Aside from that, even "safe" investments there's a chance you'll lose it and the returns are so ridiculously low to the point I can't fathom why anyone even bothers!

There's gotta be something I'm missing here.

 

[Johnnyseven]

I'm sort of in the same boat, I'm building up a decent amount of monies seen as I work and still live at home. One thing that I've done that I've been pretty pleased with is Premium Bonds, over the years I've maxed out the amount you can have and will try and keep it there.

I know its pretty much pot luck as to whether you get anything, but as far as I have worked out the money is about as safe as can be in premium bonds and it doesn't cost a thing. I worked out the amount I would have got back from the usual bank savings accounts and whatever and I've gotten at least triple that from premium bonds. My family (who I convinced to get more of them) have all had the same luck it seems.

Don't get me wrong, its complete pot luck but if you aren't doing anything else with the money it wouldn't hurt methinks, just be prepared that you might lose out on whatever measly sum you would get from saving it with a bank.

Oh and I really enjoy opening the cheque that you get in the mail if you get lucky. Might even get one of the big ones one day. Probably not though.

 

[Gennadios]

It's all bull shit. Don't even bother with the stock market. It's rigged. You'll never win. Aside from that, even "safe" investments there's a chance you'll lose it and the returns are so ridiculously low to the point I can't fathom why anyone even bothers!

That's pretty much it, the economy right now is shit, and in shit economies governments tend to set interest rates extremely low, which works for both taking out loans(good for the consumer since the interest is low) and getting interest from bonds and savings account(bad for the consumer since at this point even premium bonds with over 50k invested will ONLY pay enough [about 3%] to keep up with inflation, savings accounts can't even do that anymore.)

Stocks are too risky, there's no telling how the economy will react when the US Government decides to cut the billions of dollars they're throwing into subsidizing industries, or even when (I can't even say 'if') goes into another multi-week shutdown.

Stop trying to be responsible and buy a new car! It's what Uncle Sam wants.

 

[Mid Boss]

I'm sort of in the same boat, I'm building up a decent amount of monies seen as I work and still live at home. One thing that I've done that I've been pretty pleased with is Premium Bonds, over the years I've maxed out the amount you can have and will try and keep it there.

Ahhh sadly those are only available to residents of the UK, at least from what I've read so far. D:

Stocks are too risky, there's no telling how the economy will react when the US Government decides to cut the billions of dollars they're throwing into subsidizing industries, or even when (I can't even say 'if') goes into another multi-week shutdown.

Stop trying to be responsible and buy a new car! It's what Uncle Sam wants.

I doubt they'll ever stop subsidizing corporations since that's a big part of where re-election money comes from. Anyone who touches those is committing political suicide since corporations are people now and can throw fortunes into the political arena. But I agree that another shutdown showdown is inevitable.

 

[CaptQuakers]

Stay away from stocks unless you know what you are doing, they are extremely volatile and it's not worth the risk, saying that ( and I am going to contradict myself here) ask if your company or whoever you work for sells shares at a lower price to staff, depending on who you work for this can be a nice earner because you are buying the shares so much cheaper.

ISA's aren't bad due to that fact they are low risk low reward but you can just put your money in a an ISA and just forget about it and it will "Mature".

 

[lechat]

property
basically the only guaranteed safe investment since land value will (nearly) always increase.
should be true for most if not all countries but if you can buy a property and rent it out for 5-10 years the rent will be paying the mortgage if not netting you a slight income. rinse and repeat 10 or 20 times and you should be earning a fortune by the time you retire.

 

[endnuen]

You can invest overseas, where the market may be better. But yes, stocks are fickle and you have to have nerves of steel. Look at trends, deals being made for the industry you consider investing in, what orders have they received recently and how have they invested their money.

 

[CloudAtlas]

I'm an economist, and let me tell you that most of what the people before me have said is nonsense - sorry.


# The first and most important rule of investing is: diversify. You should never put all your apples in one basket. Do not invest all of your savings in stocks or property or government bonds or whatever.

# Second, everyone who is promising you easy fortunes or an investment opportunity that is both very safe and very lucrative is a liar. There's always a trade-off between risk and reward.

# Third, don't invest in anything you don't understand.

# How anyone can say property is a safe investment just ~5 years after a big property bubble burst in the US (which was by no means the first bubble) is beyond me.

# People who buy stocks of the company they work in are idiots (unless they are heavily subsidized and prohibited to sell them). If things go bad for their company, they lose both their jobs and their investments.

# The stock markets are not systematically rigged, they're not extremely volatile and you do not need to be an expert to invest into stocks. In fact, being an expert doesn't even help you - statistically, you can't beat the market. And while you should not invest everything into the stock market - diversify! - shunning the stock market entirely is an equally bad idea. Yes, stocks are riskier than, say, property, but the average returns on investment from stocks are just much higher (~8% per annum) - and by average I mean the average over decades. Don't forget that a large share of your earnings from stocks do not come from gains in the value of your stocks, but from dividends.
Yes, stock markets can crash, and your stocks will lose a lot of their value in the process, but you already got your dividends (as long as you haven't reinvested them all). But that's why you shouldn't invest all in the stock market, just some.

# Do not even bother looking at individual firms or industries and try to figure out what the future might hold for them and if it is hence worth investing. People who know much more about the stock market and the respective industries than you do do that already, all the time, and price this information into stocks. And they still can't beat the market.
Buying stocks from individual firms is something that you should never do anyway. Tying your fortunes to the fate of a selected few firms is just very risky.

# The best thing you can probably do in the stock market, imho, is to invest in index funds that reflect the stock indizes they are based on as a whole, such as the Dow Jones, DAX, or Nikkei, and not worry about it anymore after you did. If the stock market goes up, you win, if the stock market goes down, you lose, but at least you don't have to pay any fees to brokers because it's an unmanaged fund, and you are much more diversified than you were if you invested in individual firms only. And you don't really want to invest in managed funds because, as I said, statistically, you can't beat the market, so why paying for someone who tries to.
If I had a considerable amount of money to spare, that's what I'd do anyway.