UKC

Looks like a Brexit deal will happen soon.

https://www.theguardian.com/politics/2020/dec/14/brexit-trade-deal-possible...

Is it worth sticking some cash in an FTSE fund this evening?

I think it's a pretty good bet. At this time of year you normally get a Santa rally, and there is the Covid vaccine rally to add to that. I reckon you would be unlucky to lose money on a FTSE trade at the moment, though maybe the FTSE 250 will outperform the FTSE 100.

Note the pound might strengthen too, pushing the ftse100 down. FTSE250 might indeed be a better bet.

I'm buying tins of baked beans and shotgun shells.

Obligatory:  youtube.com/watch?v=qsMc-IswG3w&

better to put it in a pension. you'd likely be 20-40% better off instantly without having to rely on Brexit to push the price of the FTSE up.

Why not both?

Ftse 100 is less uk related than the 250, the electoral college will confirm Biden won soon too, so there are many factors. Covid lock downs across Europe will hurt industry well into next year.

Personal I'd keep your cash, too many unpredictable variables at present. 

Let us know what you did.

I already have money in the US stock market, it's doing not bad. I'd be surprised if Biden's confirmation today will have much effect but you never know.

I was thinking of chucking money into the FTSE in anticipation of a Brexit deal surge then possibly getting back out again.

Absolutely right. I hate those ring pulls on tins of beans and always open them with a shotgun

My impression was trump cut corporation  taxes and the businesses partied, but a massive gap between tax revenue and spending was growing, add in covid, I think biden has no choice but to end the shareholder party.

For what you are trying to do, I’d suggest you go to a bookmaker, not the stock market.

Chapeau... possibly the UKC joke/pun response of the year

The advantage of the stock market over a bookies, is that if he gets it wrong, he wont loose all his money. In fact in a year or two, he might be up on the deal. Obviously the odds might be better at a bookies, but at increased risk.

The problem is that there is a certain amount of friction when buying shares. There's dealing costs and the spread to take into account. Because the ftse100, is broad, you're probably not going to get 10% in a day or two. There's money to be made on both sides of the deal, but unless you're putting in huge amounts, I'd hold off on that call to the Ferrari dealership.

Think you might be too late, a few days ago maybe.As they say timing is everything. Could still be worth a punt if you have the spare cash.

I took a "bet" on the American market back in March and my gains are close to 30%.

But equally I recognise that some of my other bets have not been so good.

Compared with other hard nosed and more informed investors I am a mere amateur.

Yes, I stuck money into the S&P 500 this year and have done alright out of it too.

FTSE250 seems quiet at the moment. No big movements in the last few days.

https://www.google.com/search?q=ftse259&oq=ftse259&aqs=chrome..69i5...

No. The stock market is absolutely roaring just now, it's replete with government subsidies to companies and workers and there is every reason to suspect that a crash is overdue.

Also, the very fact you are posting this question suggests that you do not have a long and seasoned career in fund management or investment banking behind you. In which case, you should treat any short-term bet like the one you suggest in the same way as you treat betting on horses or football teams - it's a pure gamble so be sure that you view it as this and not as "an investment".

I personally don't think there will be a deal this year, even if an agreement were reached tomorrow I can't see it being rattified and implemented before Jan and when you consider that all EU countries must ratify it individually I can well imagine it sticking in one or two countries and taking 6 months to get finally agreed (or longer). I think no-deal is overwhelmingly likely. I don't even think they will be able to agree something which means we will be continuing negotiations in 2021 but with no deadline to focus minds, so most likely the timeline to get a deal and get it agreed starts to look like 5 years or longer. 

Personnally I have a very negative view of the UK and European economies, I just think they are all stuck in a time warp of zero to very little growth.

Day trading or for short period is not for me anyway, I think its a mug game as you easliy just get sucked in.

Depends on your view on lots of things.  I like a quiet life: invest in quality internationally based companies (which you can get in the FTSE100) with a three to five year timescale and try to remember the old adages ("Don't invest money you can't afford to loose", "don't get greedy", "leave some for someone else", "don't try and time the market" etc).  Not very sexy at all (and possibly even boring/conservative) but I like to sleep at night.

'Day trading or for short period is not for me anyway, I think its a mug game as you easliy just get sucked in'

You are right about that. I do place the occasional spread bet on the FTSE, but only with an amount of money that I would be prepared to lose taking the leverage into account. Otherwise I would be sitting in front of my computer all day long.

Nobody suggested he put all of his money with the bookies.

You are talking about investing.
If you read the OP he said he wanted to bet on a specific one off event.

For that, a bookmaker is much easier, less risk, faster, and more transparent.

“Day trading” is a completely useless thing to do for the average punter. Has been since the late 90s. There is simply no alpha to be made on those short term bets. 95%+ day traders will be losing money. The only ones getting richer are the trading platforms and the robots.
 

Think of it not as a bet but an investment of a speculative nature.

Buy some ETFs and see if they increase in value. If they do great, if they don't I sell them and won't have lost much. I have no intention of spending the days glued to a monitor watching the share price of a few companies twitching up or down.

It is a bet though.

You won’t have lost “much” as proportion of the investment, yes, but it doesn’t mean that it will be less in absolute term than the equivalent loss for the same potential return with a bookie.

Basically I don’t see any reason to bother with ETF for what you are doing, go to Betfair. 

Or you can invest for real, buy some ETF and keep them for the long term. But that means locking away your capital, which isn’t what you want to do from what I gather.

All very well - but what exactly did you do? Or is this all hot air?

I did what I said I would.

I put the dosh on the ftse100 as the ftse250 seemed to have shifted already.

https://g.co/kgs/bb4YN4

That's fallacious logic. If you expect a small swing either way on the stockmarket then you have to put up more capital to see the same return. So you could actually lose more on the stockmarket than at the bookie's, though you could also win more.

I clicked on this thread at about 9.30am to read it, and since then Bitcoin has gone up $1200 lol

(it will prob drop that much by tea time to be fair)

I had bought 100s of bitcoins when they were worth pennies.

Why why ho why did I sell them for a mere 600 quid a few month later, thinking I better cash out before everyone realises it’s useless. 
I guess I underestimated how long the scam would go on.

A bit of a white knuckle ride I think.

If you buy some do let us know how it goes.

Ftse100 would normally be under pressure on a rising pound and is mostly constituted of companies with revenue from outside the UK.

So it’s an odd place to bet on a positive brexit outcome.

I reckon Brexit and Covid vaccine cancel each other out.

I reckon Brexit will slow our recovery from COVID. ( deal or no deal)

Which is correct, but not the point I'm making.

A bet is a binary thing. Win - you have your stake plus winnings. Loose 100% of your money is gone. The stock market is more fluid. If you loose, the market drops, you'd have less cash were you to sell there and then. Even if it drops by 90%, you still have something. One would hope that the economy will pick up, and you'd still get dividends. At some point, be it months, years or decades, you'd stand a good chance of getting more or all of the money back. (With a broad index like the FTSE.)   

That's not to say it's a free gamble. There is an opportunity cost. If you wait years for your shares to rise in value, the money that is tied up, could have been used for more productive ventures.

I did a while ago. But since I last posted on this thread saying they had gone up $1200 since I read the thread this morning...they have gone up another $1000 ! Wild ride
 

What's driving it?

Since I last posted last night , gone up ANOTHER $1000 

totally unsustainable but fun for the few days it happens 

Some of the main reasons that are given are monetary expansion fears to fight the effects of covid on world economy and the fact large buy side investment funds have decided to get in on the act. 

but it is extremely likely to fall thousands of dollars in a day or two as has happened before many times  

my mate summed it up well I thought, (this was before they were $22k each) buy a coin for each of your kids or grandkids and when they are older they will either buy their first house with it, or buy themselves a beer with it...

This is now the biggest ever move in BTC in USD terms (has been similar in % terms when it was cheaper). 

Except the small investment idea has the small problem that bitcoin transaction fees are over $4. Also any massive gains are of course subject to Capital Gains Tax.

https://ycharts.com/indicators/bitcoin_average_transaction_fee#:~:text=Aver....

transaction fees are fine when it climbs 20% in a day  As for capital gains, only a matter of time before you will be able to wrap it in an ISA ... and lets face it...does HMRC have a clue about anyones bitcoin holdings? 

Rather you than me deliberately hiding capital gains given the criminality and fines. HMRC might be clunky on chasing bitcoin accounts but if large assets suddenly become visible (like a seemingly unaffordable house) I'd give small odds it won't be spotted. 

Is putting money on bitcoin speculation (gambling, untaxed) or investment?

I think this question was asked a couple of years ago and wasn't sure of the outcome.

I'm no economist so I'll ready confess my ignorance as to why something like this has "value" beyond that which can be attributed to fine art or ancient booze - the hope someone will buy it off you for more then you paid (ie gambling)

I get that it is independent of government and could be used as a safe haven like gold. But as a stable safe haven? Maybe if your alternative is Venezuelan Bolivars or magic beans.

I also see it's handy for moving funds about for which might not be entirely honest (although the transaction is publicly published)

I'm intrigued to know what stops people en masse just saying this is bollocks, doing a runner and collapsing it in a mad rush for the door. Of course the same can be said about Euros or US dollars but they don't usually fluctuate by 20% in a day like the odds at Wincanton. 

You could always buy Bitcoin with a spread betting account, spread bet profits are not subject to any form of tax.

What are the fee structures like on those? Fees on standard investments tend to be on the high side and those transaction costs would bite small players.

The big gains were for those who held bitcoin early. For new players it looks very high risk unless it's a side bet alongside much bigger investment 

Currently you can buy for 22746 and sell for 22695. It's quite a big spread, but that's where the spread betting company makes its profit. Plus there is a small daily holding fee. It is unlikely that spread betting will ever be taxed since the majority of participants lose, so if it were taxable they could set their losses off against tax.

You are going to be into fairly serious gains if CGT becomes an issue - £12000 or so allowance a year.

Why does gold have a value?

Indeed, aside from its industrial uses which are probably small in comparison with just holding it, the value of gold seems "arbitrary".

It's why I'm interested to know what props it all up.

Because there is effectively a finite amount of it on earth, unlike fiat currency which can be, and is being, conjured out of the air ad infinitum.

Don't you have a personal limit for capital gains? If so that amount only applies if that is your only investment that is liable. 

I know people who made way over that amount, ordinary folk with an understanding of financial biased IT as bitcoin started. I was advised it was 'a sure thing' in 2009 and should have gambled. I was considering a £100 speculative punt in late that year and was distracted by a lot happening in my life (guidebooks, reorganisation at work on an already crazy work diary).  I think that £100 would now about £500,000

Exactly. And likewise bitcoin: there is a defined finite amount.

I agree re hiding assets 100%. But capital gains is not a good reason to not invest in an appreciating asset.

haven't you been watching Masterchef / Gt British Menu ?

There are no commission brokers. I got into the game quite late after the crash (July) and have tentatively added to it but I'm up about 12%.

"The big gains were for those who held bitcoin early. For new players it looks very high risk unless it's a side bet alongside much bigger investment "

If you bought three months ago you would have over doubled your money. Those people were not "early adopters". I think it makes a pretty sensible choice to hold some as part of your investment portfolio. As do a lot of large buyside investment houses now as it happens.

My firm (a large conservative investment bank who doesn't get involved with it at all) research sees it easily going to $25k-$30k in 2021. The exchanges have improved, it's less like the wild west now so less chance you will lose everything (although it's still too much risk for lots of people which is fair enough)

Caveat - it could be back at $10k or lower in 2021....i don't think anybody knows. It is a speculative bet, taken with some knowledge of the new monetary landscape post covid..no more than that.

"I think that £100 would now about £500,000"

I reckon you would cope having to pay capital gains on that investment.... lol

Yes, as above

Yes.  Most people don't have major capital gains - if they do, they will know how things work.

Well, yes.  You aren't the only one thinking that!  How many have actually managed it??

Post covid crash? My ISAs have done a good bit better than that since then. Few ordinary folk have investment capacity above the ISA limit (£20,000 a year now).

To run the risk of repeating myself, you can invest in both shares and stock indices with a spread betting account. There is a book called The Naked Trade's Guide to Spread Betting by Robbie Burns in which he introduces the concept of the SpreadISA - once you have invested your £20,000 in an ISA you can make further tax free gains in a spread betting account. You can obtain guaranteed stop losses on anything you are betting on, and you also have the ability to short a share or an index. Obviously, strict discipline is required.

Most people think but few failed to follow up on clear good advice like I did! Money was never my priority in life so when things get busy and stressed it's not the only opportunity I've missed. It's one reason I like ISAs: the company I use recommends good products with fee discounts and I only need to deal with paperwork annually and despite the crashes they have proved better than standard alternatives with minimal distraction to my life.

Thanks for the heads up although it does sound like too much active involvement for me.

Also note 70% of people lose money on spread betting - I imagine most don't think it will be them!

It depends on how you use it. When I first realised that Covid was probably going to affect the value of my shares, I didn't immediately sell anything but I shorted the FTSE. I did sell most of my shares a little later, but the money I gained from shorting gave me extra funds to invest around the bottom of the market. This hedging technique actually added to my overall security - it the FTSE had risen, I would have lost on my spread bet but my shares would have risen.

My understanding is that CGT only becomes payable at the moment you convert out of the crypto coin into currency.  So if you are lucky enough to have made more than £12k, you can time your withdrawals to stay under the personal limit each year.

Were your funds invested pre covid? I'd expect that to be the case as I've been watering down the returns by adding to it. My GF didn't add to her initial investment and is up about 40%. 40% of not a lot unfortunately, hey ho. 

I'm up cf inflation since this time last year on my older ISA investments and the late spring 2020 ISAs have done very well ... the position on my older investments is much to my amazement (it was a terrible start to the year). What I get from this year is, on average, the super rich made a fortune, the reasonably wealthy weathered the storms and some got richer and the poor got hammered. This is no way to run a stable modern social democratic society: we desperately need tax change to make things fairer.

As I approach 60 my time (and physical fitness) feels increasingly valuable and I have even less interest in using it messing around  more than I need with money.

And the paradox you want to invest in Bitcoins! How equal is that.You have sniffed a money making opportunity and you want some of the action , very capitslistic of you. 

Lol ........

All hardly surprising given I'm a social liberal. I don't need to wear a hair shirt to believe in better regulated capitalism, fairer taxation and improved state support for the unfortunate than we have in the UK right now.

And yet you are considering Bitcoins......

Sorry, but it does make me chuckle.

I'm definitely not now. I was considering a small investment in 2009.  Large scale tax evasion and criminal usage of bitcoin are real issues so I think, like much of modern capitalism, it needs improved regulation.

Exacly why I would not touch it with a barge pole.

Values in more ways than one.

Yet a good number of IT based disrupting megacorps are exploiting loopholes in state and social protections to produce unfair competitive advantage or doing things like generating advertising revenue on the spread of hate, or even abusing personal data for undermining democracy. Back in 2009 bitcoin was being talked of as bypassing bank rip-off currency exchange rates. Disruption overtook regulation everywhere, to make unfair profits and sometimes damaging social and democratic structures.

Of course this does not mean that you personally have to buy into Bitcoin......

That talk of Bitcoin was always hogwash and spin, I am surprised you have bought into it.

Turning a £100 investment into £500,000 in a decade in a product way more ethically dubious than it appeared at the time may be many things but it ain't hogwash and spin. This is no tulip bubble. On ethical buy-in people are involved in ethically dubious investment all the time, through pensions if nothing else. Bitcoin being ethically worse as an IT disruption than AirBnB, Uber, Amazon, Google, Facebook, Microsoft etc, doesn't forgive their major ethical misdeeds and a failure of governments to regulate.

The difference is of course that Bitcoin is not regulated and as you say yourself involves big crime and tax evasion not avoidance.

Whereas whatever you say about the others, they can be.

All the others have been found guilty of some crime somewhere. It's a mater of scale and a sign of how piss poor regulations are in our current capitalist systems. It not just IT disrupters either... tobacco, oil, mining, pharmaceuticals, chemicals, building, finance....

Good day for a bet........

The best laid plans o' mice and men gang aft agley 

And leave us nought but grief and pain for promised joy 

("gang aft agley" - often go astray)

It's much easier being a poet if you can just make up words to get a rhyme. 

But perhaps someone should point out to ar Rabbie that 'agley' doesn't in fact rhyme with 'joy.'

Yep, the Gruniad full of shit as usual.

FTSE 14th Dec 6531.83

FZSE 21st Dec 6416.32