Million Investment

S

samkelly

Guest
I am new to the forum and have no previous knowledge about specialist investments. My wife and I are in the course of selling our property and expect to clear in the region of 1,000,000. We are considering the idea of renting instead of buying a new property and using our funds instead as an investment. For this sort of money are there any good investments that would yield at least 6% while guaranteeing, or growing, our capital. Would welcome any suggestions. Many thanks - SAMKELLY
 
to answer your question concisely - No!

An Irish Govt Bond is probably the closet you can get to a secure investment and is yielding 4.5% or thereabouts. Even this could entail some capital risk if you needed to cash it in before redemption.

Anything paying morte than that would entail taking on some risk.
 
Thank you JPD. Rather than being specific about a return, I should have asked what would be the best option for such an investment, bearing in mind security of capital ?
 
samkelly said:
Thank you JPD. Rather than being specific about a return, I should have asked what would be the best option for such an investment, bearing in mind security of capital ?
Click to expand...

For safe bet without much fluctuation, then you could do a euro swap into sterling (1m will get 0.2% of one percent trans rate through money market dealer. Euro at all time high presently due northern rock fall out - causing weak stg. Bank rate of 6.75% on deposit through city of london bank. In future stg should revalue 5% adjustment; hence get a 10% net return hopefully within 12 months.
 
Without a full study of your needs, your assets and your appetite for risk it is impossible to give any meaningful advice. I would contact an independant advisor for such an amount of money.

Do not expect objective advice from any one employed by a bank, investment company or assurance company or from an advisor who will earn commission by selling you some product ( no matter how good the product is)
 
In the meantime while you are figuring out where to put the money:
1. Spread it around the best rate short-term deposits - see the best buys section in AAM.
2. Decide when you will need the money and how much - this will give you a spread of money allocation based on the expected number of years you will need it in, so you need x for year 1, y for year 2, z for year 10 etc.
3. No investment is risk free, but generally you get what you pay for. With the ECB rate at 4%, anything over that starts to increase in risk (although since the banks are paying closer to 5% to borrow from each other, you can see bank deposit rates of up to 5%).

Be prepared when you go and see an advisor. As jpd says don't believe the guff they come out with if they are tied in any way. Don't be afraid to ask rude questions (like how much are you getting in commission). Expect to pay for good advice on an hourly rate (so it pays to have some homework done as above regarding timescales and risk). As you have a single large, or I would say, several quite large (3@300,000 + 1 shorter term) sums, you (or your financial advisor) may be able to negotiate a better deal from some of the banks. There are apparently high net-worth products at various levels of risk.
 
Many thanks for all the advice which gives much food for thought
 
You must log in or register to reply here.
Back
Top