How to pick stocks & shares?

[LadyCrazyCatLady]

I've grown up with very little financial knowledge/education. I'm attempting to rectify that and set my DCs up better for the future.

After reading around the options, I've opened a stocks and shares junior ISA for each DC with Hargreaves Lansdown. The trouble is, I have no idea which funds to invest in.

I've read about the importance of diversification and ETFs, but when faced with a massive list I've no idea what to choose.

Can anyone recommend a strategy or a good source of information for a total beginner?

My DCs are 9 and 12yo, but I'm hoping they'll keep the ISAs going for the long term.

If you're not sure what you doing, I wouldn't try picking anything specialised. An index tracker that follows the whole market (global all cap) or a large chunk of the market (FTSE 100 or similar) will be simplest. Look for one with low charges, so they don't eat away at returns.

Agree with index tracker.

I am a Conservative investor but paradoxically also believe the younger you are the more risk you can afford 🙈

So my kids have around 60% in index tracker and 30% in individual funds (big safeish long term bets like alphabet and amazon) and 10% high risk funds (could fail, could yield >15% pa)

I just use trackers for the kids. The fees are low and they follow the market. I don’t have the time or inclination to actively trade individual stocks on their behalf ( ironically as used to do it for a living).

I have a lot of my kids H&L isa invested in ones like HSBC All world accumulation, or L&G USA index. They’ve done really well.
For my own money I will also buy shares like Meta, Microsoft etc or other random companies I’ve read about but I tend to be more cautious with the kids.

HSBC Global Strategy Adventurous portfolio, class C accumulation. Was recommended by my financial advisor and has performed well.

Agree, broad index trackers is all they need - if they can stay invested for 60+ years with regular contributions they will enjoy a very comfortable retirement.

My kids money is mostly in ethical and eco funds on the basis that those will work better in the long term. The world will have to switch to solar and away form oil and gas so that is where my investments are going

Thank you all.

Definitely agree with tracker funds. Go for the "accumulation" ones which mean dividends are re-invested not paid out.

I don't like the idea someone said of putting 30% in "safe" individual stocks like Amazon. Who is to say that is safe? They are big now but could easily fall to zero over 10 years. Remember when people thought bank shares were "safe" before 2008?

My kids’ ISAs are also invested in tracker funds (accumulation) - Fidelity Index World, Vanguard Global Equity etc.

Regular investing smooths out the peaks and troughs a bit - I save monthly.

A lot of people feel overwhelmed when they're first starting out with stocks and shares, so you're not alone. It’s great that you've already opened a stocks and shares junior ISA—that’s a solid step!

Another useful thing is to check if platforms like Hargreaves Lansdown offer any tools or guides that break down fund performance or risk level. That way, you can get a clearer picture of what suits your goals. Some platforms, like moontrader, also provide resources to help you understand the stock market better, which might be helpful for making more informed choices.

Not advice, and so on, but a good simple allocation with low charges and fees would be:

VWRP - Vanguard global equity ETF - 80 to 85%
AEGG - iShares global aggregate bond ETF - 15 to

Some would argue that for the very young you don’t need any bonds and can stick the whole thing the equity ETF, but lots of studies show that a small bond allocation won’t really hurt your upside very much but will provide decent protection in the event of a big equity downturn.

The important thing is to not panic when values fall, which they will at some point, and to try and rebalance your holdings to your initial splits (say 85/15) once a year.

I just posted a similar thread, but the max AMC that I should pay?