One slow moving Saturday after Christmas, Rupert and I got chatting about shares. It came about when he saw me reading a share dividend report on my Sainsbury’s shares. This peeked his curiosity and to compound it I also explained I had been spread betting on the Sainsbury’s share price too. Without getting too complicated at this stage the thing that impressed him was that I had bet on the falling price of the share and had also made money. We then started thinking of the fact I owned the asset and although the price had fallen, I had made money on the spread bet which went a long way to covering most of the loss. The realisation dawned that when the price started going up again, we would claim the profit on the spread bet and benefit from the price rise again. So in theory, we wouldn’t lose any money on the falling value, but would make money on the rise in price after it turned around. Then lots of ideas came into being, what if we took the money we made on the spread bet, and bought more of the low priced shares so when the price rose we made even more money. What if we bet on the price going up as well…..
Then a little plan hatched in my head. Why didn’t we see how much money we could make from one share over 12 months. So we made one or two little rules
- FTSE 100 Company
- Less than £10.00 per share
- Purchase 100 shares
We went through the FTSE100 and picked about 20 companies then we picked our top 3 each, of which we picked 2 of the same shares, then we picked our top one of the 2 and both landed on Legal and General. So it was decided to purchase 100 of these shares on Monday 31st December 2018. along with this we have added a sum equal to the cost of the shares to allow us to take on the spread bets when the spread betting market allows. Please do not worry about the spread bet part of this, as it is not for people who are beginners in share investment, but just take our word for what happens as we travel through the year (If you really want an idea look here).
This is a simplish, non scientific test. We will simply buy shares as we make money from any spread bets during the year, and convert any remaining cash into shares on the 31st December 2019. We will then look at the number of shares we have acquired during the year and also the price/value of the shares to compare them with the start of the year.So the start of this adventure values the “whole ” account at £477.35. Being made up by:
- 100 Legal and General Shares = £232.70
- Broker fees = £ 11.95
- Spread bet match = £232.70
If you wish to follow our path we travel please pop back here weekly or perhaps monthly. We are living life so we wont spend countless hours on here but just up date you once a week to show how things are going, and the majority of those will be “same as before”
Thanks for popping by and reading this far, and perhaps we will have the pleasure of your company again sometime soon, perhaps follow the hashtag #oneshare
Paul and Rupert