INVESTMENT CLINIC

I’VE never invested, but have been reading about some of the high returns that can be made by putting money into stocks and shares.

I’m happy to tie up my money for two years, but don’t want to lose any. Where should I start? J. L., London. The first thing to say is that with investing, you can never guarantee that you won’t lose any money. The very nature of investing means taking that risk.

If you can’t stomach the idea of losing any cash, then the best thing to do is look at savings bonds from a high Street bank, where your initial sum of money is guaranteed.

Second, two years is not really long enough to invest for.

Typically, experts advise that you should be looking to tie up your money for a minimum of five years when you invest.

This is to give you time to ride out any ups and downs in the stock market — if you do lose money, there is time to try to make it back.

Finally, I would suggest that, for a first-time investor, picking individual stocks and shares to invest in is quite a risky way to go.

If this is your first foray into investing, it may be better to pick a fund manager. This means you are letting an expert do the stockpicking for you, and it also means your money is immediately spread across say 80 to 100 different stocks and shares, which lessens your risk considerably.

If you just pick two or three stocks yourself, then you have all of your eggs in a very small basket.

If you are serious about investing, are happy to tie up your money for at least five years and are prepared to accept you might lose some, then the best place to start is by setting up an account with a low-cost fund supermarket such as hargreaves Lansdown or Trustnet Direct.

Many of these provide questionnaires or research to help you pick an appropriate fund.

Important things to consider when you are picking a fund include its track record, fees and whether you believe in the strategy of the fund.

Similarly to stocks and shares, you should also not just be picking one single fund in which to put your savings.

If you pick a selection of funds that invest in different assets and different regions, that spreads your risk — it means if there is an economic downturn or event, then your funds shouldn’t all be hit at once.

If you don’t feel confident picking funds yourself, it may be worth seeking help from a financial adviser who can do that for you for a small fee. Many advisers will set up an investment Isa for you for a oneoff charge.

If you have an investment question, get in touch at Investment Clinic, Money Mail, Northcliffe House, Derry Street, London W8 5TT.