Portfolio Diversification

[Aussies5 EngSA 0]

Chaps

Looking at putitng my £10,200 ISA limit into a stocks & shares ISA. Thinking of :


BP
Man group
Shell A
RSA Insurance
Santander
Barclays
Aviva
BHP Billington
Cable & Wireless

So, a bit of oil, mining, insurance, banking & comms.

I am not looking for stellar, get rich quick returns. Just a yield > 5% adn some capital growth.

Am I missing anything obvious?

[marsred]

I'd put £9200 in those stocks within an ISA and put the other £1000 on England to win the Ashes.
Would be a good boost to your capital growth and tax free.
Just imho of course

[Aussies5 EngSA 0]

marsred said:

I'd put £9200 in those stocks within an ISA and put the other £1000 on England to win the Ashes.
Would be a good boost to your capital growth and tax free.
Just imho of course

I would think about it, but the odds currently make Australia a better bet.

I'm not going to get any useful help on this forum until I change my username back, am I........

[walm]

Not sure that bunch will give you >5% yield.
Remember there is a 10% dividend tax you pay even when in an ISA IIRC.

You might as well put it in a FTSE 100 tracker.
Cheaper.
More diversified.
Less of a headache.

[NoelWatson]

walm said:

Not sure that bunch will give you >5% yield.
Remember there is a 10% dividend tax you pay even when in an ISA IIRC.

You might as well put it in a FTSE 100 tracker.
Cheaper.
More diversified.
Less of a headache.

How can it be cheaper if you buy and hold indefinitely?

[NoelWatson]

Aussies5 EngSA 0 said:

Chaps

Looking at putitng my £10,200 ISA limit into a stocks & shares ISA. Thinking of :


BP
Man group
Shell A
RSA Insurance
Santander
Barclays
Aviva
BHP Billington
Cable & Wireless

So, a bit of oil, mining, insurance, banking & comms.

I am not looking for stellar, get rich quick returns. Just a yield > 5% adn some capital growth.

Am I missing anything obvious?

Utility such as UU.?

[cailean]

I find that is too diversified. You should do your homework and focus on fewer, you are then more likely to make better decisions and be more proactive. Do research on all and find the 4 with the best fundamentals. If you are not going to do proper analysis you are just gambling really or you might as well get a tracker and hope for the best.

[DonkeyApple]

Aussies5 EngSA 0 said:

Chaps

Looking at putitng my £10,200 ISA limit into a stocks & shares ISA. Thinking of :


BP
Man group
Shell A
RSA Insurance
Santander
Barclays
Aviva
BHP Billington
Cable & Wireless

So, a bit of oil, mining, insurance, banking & comms.

I am not looking for stellar, get rich quick returns. Just a yield > 5% adn some capital growth.

Am I missing anything obvious?

Depends on the long term reasoning for each investment. Personally, I can see at least 2 which I wouldn't want longterm exposure to.

Also, what weightings to you plan for each holding and will you orientate it towards sectors or geographic exposure?

Additionally, how do you plan to build the portfolio regards timeframes?

[walm]

NoelWatson said:

walm said:

Not sure that bunch will give you >5% yield.
Remember there is a 10% dividend tax you pay even when in an ISA IIRC.

You might as well put it in a FTSE 100 tracker.
Cheaper.
More diversified.
Less of a headache.

How can it be cheaper if you buy and hold indefinitely?

Where did he say he was buying and holding indefinitely?
Or are you asking a genuine question because you are unsure of the difference between the cost of 9 transactions vs. 1 offset buy the small management fee on a tracker?

Everything Depends on his ACTUAL holding period.
9 transactions vs. 1.
Say roughly £10 transaction fee on each trade for a c.£1000 trade is obviously c.1%.
Vs. 0.1% if you do the tracker.
If the tracker charges 0.2% fee per annum you can hold it for 5 years and still be up (depending on the growth obviously).

Given he appears to have put some thought into his choices and given that things change in the markets all the time, he might, you know, CHANGE HIS MIND...
That implies MORE transactions, which when each trade costs you 1ppt of performance that eats into your compound growth pretty fast.

Then again, as I mention elsewhere, everyone on PH is capable of beating the market with a little homework so a trifling 100bps of a long-run equity growth of 700bps shouldn't trouble our armchair stock enthusiasts.