200k to invest for 1 year

[Invest2profit]

Hi all, simple ask (I think?) and open to all.

Have 200k to invest for 1 year, I current fixed savings account is 6.00% yearly interest or 5.85 or. 5.75% monthly (have applied for but has since been pulled I believe so can't recall) return paid monthly (preference for this as it gives me a monthly extra sum available IF ever needed) Secure trust bank. So either approx £960 monthly return or 1k equiv if annual.

Or.. Do I look to invest in a fund? Or other choices?

Read alot about funds regularly beating this on an annual basis. A certain Warren Buffett I believe has a good one.

1. Can anyone recommend good funds, and comments why and evidence of better returns if easily advised.
2. Any other financial products?
3. How you go about investing in a fund
4. Any other general. Investment advice. Maybe split 100k Into fund 100k?
5.Is it a wise time to invest as I'm seeing negative returns on some of the top funds for the last year.

Thanks all

[Alaric]

Have 200k to invest for 1 year

Your key point is perhaps whether you can live with getting back less than the £ 200,000 in a year's time. If you cannot, that restricts your investment choce to deposits and possibly money market funds. If using deposits, spread over severa; providers to take advantage of the FSCS compensation scheme in the relatively unlikely event that the chosen institution goes bust and cannot or will not give the money back.

[Gerry557]

The general consensus is that you don't invest for such a short time. Investing is more a medium to long term 5 years or so.

You don't say why or what the 1 year requirement is for. So it's hard to think of the worst case scenario could be.

The main reason for not investing short term is shares can fall rapidly and it might take a while to recover. Assuming you "need" to spend that amount at the end of that period then I think it's down to cash deposit or some sort of fixed rate bond.

You could try some premium bonds hoping for the big one or some smaller winnings but you might wind nowt.

I won't go into the investment questions yet until its confirmed that you do really want or mean to invest.

So currently I'd recommend the highest monthly interest rate you could get. I don't know where that is right now. There used to be tables that listed the top ones.

You don't mention any tax consideration either.

[88V8]

Have 200k to invest for 1 year,
2. Any other financial products?

At this stage in the interest rate cycle I would buy Preference shares.
Yields currently 7% or better, and lower tax rate given they are taxed as dividends rather than Interest, plus an excellent chance of capital gain if, as I expect, that are premium takeout offers from issuers.

I would buy AV.A, AV.B, GACA, GACB, STAB, STAC, NWBD, ELLA.

However, over a short holding period one has to think of the spread on resale, so I would accept that this is not without risk.

V8

[Dicky99]

However, over a short holding period one has to think of the spread on resale, so I would accept that this is not without risk.

V8

I've bagged some of the preference shares quoted and what with the spreads and charges there won't be much if anything left of the first divi. Assuming the same on sale I'm not sure how it could be viable for 1 year.

[monabri]

What happens after 1 year?

[monabri]

Based on that timeframe I'd say your safe (ish) option is to park the money in 1 year fixed rate bonds. Use up your ISA allowance on one of the bonds but you are still potentially left with a tax bill on the interest on the £180k . You'll have to declare this to HMRC if you have other taxable income ( you don't say
but you might be working/drawing a pension/ have income from elsewhere).

I'd Split the money up into chunks and don't put more than £80k in any one ( the financial services compensation scheme covers losses up to 85k so I offered 80k to allow for accrued interest). Only put your money with a company that has the FSCS cover.


Investing with Buffet ...would be in the Berkshire Hathaway fund, BRK.B which is, unsurprisingly in dollars. You might get lucky if the fund does well over the next year and even better if you were to cash in and Sterling exchange rate takes a fall. That's a gamble as the complete opposite might happen. In addition, ,you'd get charged for converting £ to $ ( and back) so you can buy BRK.B and you MUST fill in a W-8BEN form mandatory.

[monabri]

Have 200k to invest for 1 year,
2. Any other financial products?

At this stage in the interest rate cycle I would buy Preference shares.
Yields currently 7% or better, and lower tax rate given they are taxed as dividends rather than Interest, plus an excellent chance of capital gain if, as I expect, that are premium takeout offers from issuers.

I would buy AV.A, AV.B, GACA, GACB, STAB, STAC, NWBD, ELLA.

However, over a short holding period one has to think of the spread on resale, so I would accept that this is not without risk.

V8

I've been buying GACA,B recently (last and this month) . I bought into STAB a little too early but nothing too disappointing. I have "change" in ELLA. I have also added SANB ( no holding in AV prefs, I hold the Ordinaries nor STAC). GACB is interesting.. close to or below par with a dividend (XD) soon.

As Dicky99 says, the spread is the killer over a short time.

[monabri]

I'll be blunt ...based on the timeframe you shouldn't consider investing in funds or individual shares. No one knows what will happen on the market(s) so going down this route is a guess, a punt. There's no guaranteed get rich scheme.

Being doubly blunt, you ask about how to go about buying funds ....to which I'd reply...spend the next 6 months reading about investing before making any forays into investing in this way.

[dealtn]

Hi all, simple ask (I think?) and open to all.

Have 200k to invest for 1 year, I current fixed savings account is 6.00% yearly interest or 5.85 or. 5.75% monthly (have applied for but has since been pulled I believe so can't recall) return paid monthly (preference for this as it gives me a monthly extra sum available IF ever needed) Secure trust bank. So either approx £960 monthly return or 1k equiv if annual.

Or.. Do I look to invest in a fund? Or other choices?

Read alot about funds regularly beating this on an annual basis. A certain Warren Buffett I believe has a good one.

1. Can anyone recommend good funds, and comments why and evidence of better returns if easily advised.
2. Any other financial products?
3. How you go about investing in a fund
4. Any other general. Investment advice. Maybe split 100k Into fund 100k?
5.Is it a wise time to invest as I'm seeing negative returns on some of the top funds for the last year.

Thanks all

Again being blunt ( but that's how lessons are sometimes learned) 1 year is far too short to be looking at an investment timeframe. Looking backwards at 1 year investment returns strongly suggests you have the wrong focus.

Give us your expectations on what you are looking to achieve, and why, and what your risk appetite is, and you are more likely to get worthwhile replies.

Sorry for that bluntness, and I appreciate your newness here and I wouldn't want to scare you away, assuming you are genuinely open to mostly friendly guidance, but your post as phrased comes across as "how can I make quick and easy and riskless profits over a short time frame". That is easily answered. On average, you can't, and shouldn't expect to.

[Kantwebefriends]

You put £50k into premium bonds and your spouse does likewise. If you haven't already done so fill a Cash ISA each. If you or your spouse has a low enough annual income that one of you has access to the allowance against income tax called the Starting Rate for Savings then bung the other £60k into a savings account with a provider that is different from the ones you are using for your Cash ISAs. If you are both taxpayers you can still get a useful amount of interest tax-free by splitting the money between accounts for each of you so that you get half the interest in this tax year and the rest next tax year.

[elephanthunt11]

It’s been said already here, but you really don’t want a fund recommendation. No sane or experienced investor would advise you to invest this money in equity given your small windows of 1 year.

I’d personally be looking at becleversithyourcash.co.uk or whichever equivalent you’re comfortable with and stick it in a fixed savings bond. My advice is to max out cash ISAs and put the rest into the best paying fixed 12 month bond, which at the time of writing is NS&I’s Guaranteed growth bond @6.2%. Be mindful to work out the difference between the lower interest you’d earn in an ISA at say 5.5% vs the tax you’d pay on the non ISA cash.

[ayshfm1]

UK gilts?

They can be sold at anytime can be held to maturity and the due to rapid rise of interest rates can be had for below par.

If I come into a lot of cash, that's where I'll be parking it.

[GeoffF100]

It is senseless to take risks if you need the money:

https://www.nsandi.com/products/guaranteed-growth-bonds

If you have no financial knowledge, spend the next year studying.