ARTICLE Having taken a quick look at the various options for those folk who are planning on making a small investment now really isn’t the time to be risking part of the monthly income and hoping to get a speedy return. You would more than likely have more chance of getting a quick return by putting your money on the favourite at the next race at Haymarket! It may sound slightly unusual but there’s lots of individuals who actually derive pleasure from the placing of a bet, and the result isn’t terribly important.

Whether it makes sense to invest in the Penny shares market is something that we have already discussed. Don’t wrongly assume that these shares are only going to cost a penny as a result of name; however, you really needs to be able to pick them up for less than $5. There is a much higher risk with penny shares as a result of fact that they have a low value. The price of penny shares often swings wildly from one direction to the other in a small period of time and if the price jumps by a great deal, an inexperienced investor will often sell. In the meantime the price may have changed again. At a time when the market is volatile it can be very easy to make the wrong decision.

Something else to consider is the time of the year. in order to make small investments remember that apparently it’s only a hundred days until Christmas. But we don’t like to mention that until December rolls around. But when you think about it, you will realise that there is not that many pay days left. In a previous post, I mentioned that you could want to buy a one share gift for someone. You could think about this if you’ve a teenager that you find it tough to buy for normally even if this is simply not a real investment. This could be the way to encourage them to follow a certain company, and watch their financial fortunes on the stock market. This kind of gift is also ideal for a christening present.

It can also be interesting to subscribe to online investment newsletters, but do be careful that these aren’t just a veiled kind of promotion or promotions for specific companies. Some newsletters purport to contain information but do check the small print at the bottom which may clarify the position. If they have been paid a fee for promoting a specific stock, then they can not be offering information that is unbiased.

Buying a book that’s aimed at new investors might be wise before you start investing. Last week I suggested that the first safe way to invest is in the mode of a Cash ISA and the amount of 5,340 which can bring a reasonable tax free return. This figure should invariably be the first investment each year – even if this amount is gradually deposited over the year.

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The price of gold has leapt from $1700 to $1900 in a matter of minutes over the previous week so new investors might be nervous about getting into such a volatile market. Traders themselves are undecided about the current fluctuations and conflicting advice is prevalent.

The current state of the stock market brings an old saying to mind ‘when in doubt, do nowt’; this is definitely ringing true at the moment. When the markets are moving quickly, it is easy to become seduced by working out how much profit would have been made in a few days. This is not the best way to be thinking in terms of the stock market. Most investors are looking to earn a return on their money. Rushing to chase the trends is foolhardy and not a good way of forward thinking.

Investing more money than you could realistically afford to lose is a very bad idea. At the current time, there couldn’t be a truer statement. There is too much volatility and very little confidence in investing some experts are even doubting their own advice to a certain extent.

Whereas investors used to contact a stockbroker who used to buy for them, it is now much easier and cheaper for each investor to deal with every transaction for themselves. There are companies online where it is even possible to compare the cost of trading. When you actually make the purchase and sale yourself, rather than using a broker, it certainly gives you ownership of the shares. Once you are personally involved it becomes much more interesting. If you get a stockbroker to take care of your investment for you then you just don’t have the same amount of fun. It becomes just like a transaction. It is probably best to stick to using a stock broker if you are putting a lot of money on the stock market and you need expert advice although if you are only investing a very small level and are hoping to do some good with it then you may be better off trying your own hand at it online.

When it comes to investing in gold and silver you would probably assume that you need to invest heavily but it might be more interesting to go with a minimum stake. Platinum is also something which some people are suggesting investing in but at the moment it is difficult to tell if this is a good idea as it is still very early.

If you are looking for a safe way to invest your cash then bypassing the stock market and investing in a cash ISA might be a good idea. A person can invest up to 5340 in a cash ISA at the moment and this amount can be placed in monthly amounts. However the amount that can be saved in a cash ISA cannot exceed 5340 in a tax year and you can take money out during the year too. Don’t forget that you cannot replace any withdrawn funds during the same tax year. And for as long as you have money in your account, you will earn tax free interest on it.

Before you invest heavily on the stock market, it might be wise to set up an ISA account as you can fall back on this if you need to.

Click here to find out more information on stock market investing and other aspects of investing on the stock market.