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What to do with Money
by Macer Hall
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DAY 27: WITH THE END NEARLY IN SIGHT, THE SOCK REMAINS A DEPENDABLE ALLY.
Click here to see his money chart - updated daily.
It is four weeks since the Today programme launched an experiment to investigate how to make money. The time has arrived to tot up the balance sheet. And the bad news? In total, I ended up exactly 拢23.33 worse off.
At the start of the experiment I raided the office piggy bank to see how five different ways of investing money would fare during this worrying time of turmoil on the money markets.
The investments included: a tracker fund based on the FTSE-100 index, a building society mini-ISA account and a portfolio of randomly chosen shares. I also stuffed some cash in a sock which was then hidden under the bed. Finally, I tried buying a lottery scratchcard every day to see if luck could make me rich. Each of the five investment was worth 拢28 and lasted for 28 days.
Surprisingly, the tracker fund did best, showing a profit of 拢1.71. Tracker funds work by 鈥渢racking鈥 the movements of the stock market. Given all the financial gloom in recent weeks, I did not expect the fund to end up in the black, with a return of nearly six per cent. The best explanation is that the investment started when the market was very low and recovered slightly over the four weeks.
By far the worst performer was the scratchcards. Out of 28 tries, I won just twice, with sums of 拢1 and 拢2. That made a net loss of 拢25.
The shares lost as well, but only 13 pence. The building society made a steady but unspectacular profit of nine pence.
And the sock? Predictably, there was still exactly 拢28 left under the bed at the end of the experiment. But inflation will have whittled away some of that spending power over the 28 days. So that was a loser, too.
The conclusion is that making shrewd investments is all about getting the timing right. Getting it wrong can be costly.
Today listeners sent the programme lots of emails with their own money-making suggestions. The best has to be: 鈥淕row Brussels sprouts. 拢28 would buy about 750 seeds. If all the plants flourished, that would make 拢292.50.
鈥淚 chose Brussels sprouts because I loathe their taste. I would therefore not be tempted to eat into the profits.鈥
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He could put it in a sock, but inflation even reaches under the bed |
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Macer consults the investors bible. |
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Macer could join the ranks of Lottery millionaires |
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Soros: speculator extraordinaire |
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