Re: I aint got much BUT?
My personal opinion on the markets . . .
By and large, the Stock Market exists to take money from the naive, uninformed, impatient and generally good populous, and transfer it to the greedy, corrupt and unscrupulous city boys.
The entire system is rigged to the core, with super computers positioned extremely close to the trading servers which can log buy or sell trades in the blink of an eye and thus constantly make good profits for the crooks. The people who set the share prices (called Market Makers) are equally corrupt, using a wide range of tricks and scams to present information to the public in ways that disguise the truth. For example, the currently published Share Price (SP) for any stock is just the mid price between the lower Bid (Sell) price and the upper Ask (Buy) price. The MMs will often increase the Ask price to make the SP look like it has risen. Example. . Smiths Widgets Share Price
Bid price is 50p - (what they will pay you for your shares)
Ask price is 80p - (what you pay to buy shares)
The actual Share Price is the mid point which would be 65p so that's the price you would see in papers and on web sites.
If the MM now decides he's going to charge £1 for shares then suddenly that SP (mid-price between 50p - £1) becomes 75p. So to the uninitiated, the SP looks to have suddenly risen from 65p to 75p . . a 15% rise ! That tends to put the shae on the list of top 50 shares that have risen today and that sparks the interest of idiots.
Yet nothing at all has actually changed. If you had shares they would still only pay you 50p. This is just one trick in a huge arsenal of skullduggery that is in use daily. The system, make no mistake, is corrupt to the very core, run by bankers, financiers and the elite.
The notion of putting a little money into this system, to create a quaint little nest egg for the future that might perhaps return a few measly % is, not something to take lightly, just as putting lots of your hard earned into the black box of a pension is not to be taken lightly imo ! In both cases you are "giving your money away" to someone else and hoping that "someone else" will make money for you. If that's your mind set then my advice is wake up quickly and smell the coffee. In the context of money and finances, this is a world that takes rather than gives.
All this said I am not suggesting no-one uses the stock markets. I am rather suggesting that the markets are nothing more than a legalised scam that operates as a huge game, a casino if you like. The house will always win of course and you, the hapless punter, may also win but only if you are savvy and on the ball.
To win you generally have to PLAY the market rather than dump some money in and just let it sit there for years on end. As with horse racing and other forms of betting, people can bet FOR or AGAINST a share. So if you put your money into a share hoping it will prosper, there will likely be 1000s of other people betting that the share will go down not up. When the share does go down, those people make money, and you lose money. The opposite is obviously also true. Betting a share will go down is called SHORTING.
The City Boys in general know that the average hapless punter has no idea what shorting is nor how to do it. So they club together and raid shares with lots of them shorting it and thus driving the share price down. To them it is like taking candy from babies. This is most prevalent in the AIM market.
IMO the gov't needs to stop the practice of shorting. Until they do, millions of innocent law abiding citizens will continue to lose their money in the stock markets.
Meanwhile, if you are going to "Play" the markets then you DO need to do just that. Your decision should never be a case of "fire and forget", i.e. buying some shares and then just forgetting about them. You really need to monitor the price daily, keep abreast of what is happening in the company, read all the news releases (RNSs) and trade in and out constantly.
The Royal Mail flotation was imo a bit of a fudge, with the Gov't floating the shares at stupidly low prices to give some people a nice quick profit.
Existing stocks that offer discounted shares to existing holders I generally avoid. i.e. If the SP is currently £1 and the company offers a scheme for shareholders to buy more shares at 90p then largely it is pointless because the very act of offering such a scheme puts downward pressure on the SP and it ends up at 90p anyway.
Good luck with whatever you choose to do with LLoyds. I would simply suggest that if you buy shares, that you monitor them constantly and be prepared to sell on small rises, buy back on dips and keep repeating this to make profit. If you want to just dump money somewhere as an investment then I would think housing is a great place for that if you can afford it.
In the end, DYOR (do your own research) and seek professional financial advice and . . . caveat emptor !