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When and How to Start Investing in Stocks and Shares

The Best Time To Start

This section focuses on the investing basics.

When is the right time to start investing?

The right time to start investing will always depend on an individual's particular circumstances, but research suggests that the longer you are invested in the stock market, the greater your chances of investing success. Investing early can benefit from 'compound growth' where your earnings are reinvested back into your original investment. This means over time they have the potential to grow faster than the original investment alone. Of course, the value of investments may fall as well as rise and you may not get back all of the funds you initially invested.

This does not mean, however, that it is ever too late to start investing.

Tax-efficient investing through a Trading ISA or SIPP means your investments can grow for years free of income tax or Capital Gains Tax*.

If you are a more confident and experienced investor CFD trading, Financial Spread Betting and Covered Warrants can provide short-term gains even when the market is falling, but be warned the risk to your initial investment is much greater and you may lose more than you first invested.

Do I need a large sum, of money to start investing?

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A TD Regular Investment Account, for instance, lets you invest small amounts regularly, from just £25 a month in stocks or £50 a month in Funds.

Contrary to common belief, you don't need a large sum of money to start investing. Investing little and often can make a significant impact on your long term returns.

Investing in this way you can take advantage of 'Pound Cost Averaging'. This means if you invest the same amount of money each month, when the share price is down you get more for your money than you will when the share price is up.

This technique can iron out the ups and downs of a share or fund price over time, giving you a number of shares bought at an overall average price. This takes away the worry of timing your purchases correctly.

*The tax treatment of these products depends on your individual circumstances and may be subject to change in future.

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  • The value of your investments can go down as well as up. You may not get back all the money that you invest.

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