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Old 20.11.2012, 11:13
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Best Beginner Investment

Hello,

I have some savings sitting on my saving UBS account.
I decided that I want to make money out of my money! But I am a really begginer and I have no clue of stocks, funds, bons...
I went to UBS for advice and they offer me some different risky choices.
One of their offers will give me 7.-CHF for every 1200.-CHF in the best case! (plus some 2% interest of the account where the money will be sitting, less the fees for everything). I think this is crap.

I am looking for something like if I invest 10-20 thousend CHF I could win 3000 a year (it will pay some nice holidays for my family). I am ok with the risk and I can still sleep if I loose 3000.

I thought in buying stocks, but is this something I can do my self? Or I need to pay someone to do it for me?

Thanks for your feedbacks and advice.

Seyon
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Old 20.11.2012, 11:25
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Re: Best Beginner Investment

take it to the casino. put it on red or black and you could double your money.
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Old 20.11.2012, 11:31
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Re: Best Beginner Investment

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take it to the casino. put it on red or black and you could double your money.
I want to learn about investments. The casino will not help me there.
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Old 20.11.2012, 11:32
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Re: Best Beginner Investment

Buy some books and start reading...

It will probably cost you less than CHF3k a year so win win!

On a serious note, would you really take advice about investing from people on an internet forum that is completely unrelated to investing?

If you want to generate 30% return every year (3k on 10k) then you are being overly optimistic and you can forget it right now, you'll be lucky to generate 4-5% from stable good dividend paying stocks after all the fees etc assuming the stocks don't tank!

Anything above that is pure speculation and gambling IMHO.
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Old 20.11.2012, 11:38
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Re: Best Beginner Investment

If you are looking at being about to stomach a 30% loss, you'd be able to look at some very high risk investments and you should tell the bank that so they can point you in the right direction.

If you bank with UBS, I assume you have some kind of electronic banking and I think that share trading is available through that system (it certainly is with CS).

In my experience though, you will never get those kind of returns / risk from large/developed markets, so looking at more exotic shares or currencies might be more worthwhile
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Old 20.11.2012, 11:38
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Re: Best Beginner Investment

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Buy some books and start reading...

It will probably cost you less than CHF3k a year so win win!

On a serious note, would you really take advice about investing from people on an internet forum that is completely unrelated to investing?

If you want to generate 30% return every year (3k on 10k) then you are being overly optimistic and you can forget it right now, you'll be lucky to generate 4-5% from stable good dividend paying stocks after all the fees etc assuming the stocks don't tank!

Anything above that is pure speculation and gambling IMHO.
Any book recommendation?

Do you think is ok if I accept one of the UBS solutions for few years until I am ready to gamble myself?
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Old 20.11.2012, 11:42
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Re: Best Beginner Investment

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If you are looking at being about to stomach a 30% loss, you'd be able to look at some very high risk investments and you should tell the bank that so they can point you in the right direction.

If you bank with UBS, I assume you have some kind of electronic banking and I think that share trading is available through that system (it certainly is with CS).

In my experience though, you will never get those kind of returns / risk from large/developed markets, so looking at more exotic shares or currencies might be more worthwhile
Thanks so much! I will definitly have a look to the online share trading option. Sounds very interesting.
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Old 20.11.2012, 11:46
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Re: Best Beginner Investment

Gold, Silver, Land, Storables, Survival
Oops, forgot Guns and a Getaway plan
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Old 20.11.2012, 11:47
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Re: Best Beginner Investment

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Thanks so much! I will definitly have a look to the online share trading option. Sounds very interesting.
UBS charges 40.- minimun for each stock-exchange transactions!
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Old 20.11.2012, 11:50
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Re: Best Beginner Investment

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UBS charges 40.- minimun for each stock-exchange transactions!
If you are able to go +/- 30% return, CHF40 shouldn't bother you. Are you looking to trade daily? If so, you need to think about another option
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Old 20.11.2012, 11:52
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Re: Best Beginner Investment

You are looking for a 15-30% return with up to 30% volatility on an annual basis. So simply scan the investment universe and find a fund that shows this investment profile.

Caveat 1: this really is high risk, but you say you can affored to lose it. The issue is that 30% volatility can mean a 50% drawdown at some point i.e. a lot to stomach
Caveat 2: the past is no guide to future performance
Caveat 3: you will likely need to go into a leveraged fund, perhaps managed futures

My recommendation to you: buy The Intelligent Investor by Benjamin Graham and do not invest anything until you have finished the entire book.

A 2% return is better than a 30% loss. Return of capital > return on capital.
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Old 20.11.2012, 12:22
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Re: Best Beginner Investment

Just my two rappen...if you are interested in investing, start small. Choose one or two well-diversified funds that have decent dividends and see how they do. If you're just starting out, you will be so overwhelmed by information on individual stocks or bonds to make any sense of it.

Since you bank with them, UBS has a great online portfolio management tool that lets you monitor stocks and bonds all over the place, regardless of whether you own them. It includes written analyses on many of the stocks, graphs with long-term trends, etc. etc. I think you might have to own at least one fund or stock to use the tool, but I am not sure.

Good on you for starting to think about how to make your money grow. It sure won't do much in a plain old savings account.
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Old 20.11.2012, 12:28
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Re: Best Beginner Investment

I would recommend owning ETFs (Exchange-Traded Funds) with exposition to the whole stock market (US, Europe, Pacific and Emerging). Bond ETFs are also essential to control risk and reduce correlation in a portfolio.
Reduce costs. I wouldn't pay more than 0.2% annually to keep the fund running.

Well known ETF launchers:

http://www.etf.db.com/
https://personal.vanguard.com/us/funds/etf
https://www.spdrs.com/

Nowadays, even a good portfolio shouldn't expect more than 5% net return.

I would study the matter before invest any money.
  • A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing - Burton G. Malkiel
  • The Little Book of Common Sense Investing - John C. Bogle
  • The Four Pillars of Investing Lessons for Building a Winning Portfolio - William J. Bernstein
  • The Intelligent Investor - Benjamin Graham

Last edited by Metallising; 20.11.2012 at 12:45.
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Old 20.11.2012, 12:29
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Re: Best Beginner Investment

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Hello,

I have some savings sitting on my saving UBS account.
I decided that I want to make money out of my money! But I am a really begginer and I have no clue of stocks, funds, bons...
I went to UBS for advice and they offer me some different risky choices.
One of their offers will give me 7.-CHF for every 1200.-CHF in the best case! (plus some 2% interest of the account where the money will be sitting, less the fees for everything). I think this is crap.

I am looking for something like if I invest 10-20 thousend CHF I could win 3000 a year (it will pay some nice holidays for my family). I am ok with the risk and I can still sleep if I loose 3000.

I thought in buying stocks, but is this something I can do my self? Or I need to pay someone to do it for me?
3k from 20k would be a 15% yield.
The types of investments that offer this kind of return usually only work well as long as the stock market is bullish and share prices are rising.
Once the stock market goes down, they lose value quicker than a souffle loses air.
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Old 20.11.2012, 12:35
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Re: Best Beginner Investment

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I am looking for something like if I invest 10-20 thousend CHF I could win 3000 a year (it will pay some nice holidays for my family). I am ok with the risk and I can still sleep if I loose 3000.
Just buy Apple stock, if you can stomach 30% down.
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Old 20.11.2012, 12:52
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Re: Best Beginner Investment

My advice/experience (YMMV): Talk to your customer representative at the bank. In my case, my adviser went over a questionnaire which helped to identify my investment needs (from high-risk/high-return to low-risk/moderate-return).

My bank (Basler Kantonalbank) offers Swisscanto funds with different profiles - from very low-risk (10% stock) up to high-risk (45% stock). The remaining percentages are invested in real estate, retirement funds, etc.

I've been investing my 3rd-pillar retirement funds in these accounts for more than 10 years. In good years, there is nice growth, but the crashes (2001, 2008) have repeatedly wiped out any gains I had made. Looking back, if I would have just left it in the account earning 0.5% per year, I would probably have the same balance as I do in the investment funds today ... :-(
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Old 20.11.2012, 12:55
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Re: Best Beginner Investment

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Any book recommendation?

Do you think is ok if I accept one of the UBS solutions for few years until I am ready to gamble myself?

http://www.gillenmarkets.com/the_book/

Heard about this book on Irish radio might be worth checking out. He has a good reputation.
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Old 20.11.2012, 13:13
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Re: Best Beginner Investment

I would try and research publicly traded companies you feel you know about and make products or services that reflect your interests. Try and select three companies that you feel you know intimately and that you believe are actually better than what you believe the rest of the people in the news and media think. Then buy and them and monitor them. If they go up, try and figure out why. If they go down, the same. Read and research and read and research until you know more about these companies and the associated sectors than most others.
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Old 20.11.2012, 13:18
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Re: Best Beginner Investment

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I want to learn about investments. The casino will not help me there.
if you want to learn about investments it is something you need to do yourself.

expecting 30% profits without knowing how or why is just pure gambling. in which case, a single spin on the roulette table may offer lower transaction costs and less hassle than share dealing.

Last edited by Phil_MCR; 20.11.2012 at 14:47.
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Old 20.11.2012, 14:45
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Re: Best Beginner Investment

Ugly Phil is correct - you might get 30% return but only on investments where the risk is such that you can as easily get a 30% loss. There is no free money.
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