Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Don’t lose sight of what stocks can deliver

The old Chinese curse ‘may you live in interesting times’ has rarely felt more apt than it does in 2017. Amid all the noise about Trump, Brexit, European elections and the rest it can be useful to take a step back and appreciate just what the humble share can deliver in the long-term.
AJ Bell’s latest edition of its quarterly Dividend Dashboard spells out the kind of returns you can achieve through reinvesting the dividends from shares.
The report assumes the FTSE All-Share continues to generate the compound annual growth rate since inception in the early 1960s of 6.8% a year and pays the same annual dividend of 3.8%.
On this basis if you had invested last year’s ISA allowance of £15,240, and subtracted 1% a year for platform administration and dealing fees, you would be sitting on £231,577 after 30 years with dividends reinvested. This level of return dwarves those offered by cash on deposit.
Spirit of adventure
In our main feature this week we make the case for including some high conviction stocks in your portfolio.
It is not sensible to invest in individual shares with money you cannot afford to lose and nor should you take unnecessary risks. However, there is a case to be made for retaining at least some spirit of adventure in your investing.
After all, the stock market’s origins lay in backing the ventures of 16th and 17th century merchants targeting distant and exotic markets.
Being part-owners of the latest names looking to the public markets to back their plans for growth and wealth generation can be exciting and fun as well as potentially boosting the returns from your hard-earned cash. (TS)
Important information:
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
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