Life

What to invest in: £350 or more per month

From fashion to diamonds, wine to art, Stylist reveals the savviest ways to invest your cash as part of our Make The Most Of Your Assets feature.

Shares in fashion and jewellery

What is it? With some help from a broker you can put together your own portfolio of shares in individual fashion and gem companies. Options already include Burberry, Gucci and Tiffany & Co. Prada will also start selling shares in May. Investing will give you a slice of the company’s profits. Get a broker at unbiased.co.uk, who will charge around £20 for each group of shares you buy or sell.

How much could you make? There isn’t an average return for fashion and gem shares, but if you’d invested £1,000 in Mulberry a year ago you would have made around £270. Tiffany & Co grew by 38% last year, which would have given you approximately £380.

What’s the risk? High – individual companies can go bust or suffer other unexpected bad news, which can wipe millions off the share price. You either need to monitor your portfolio regularly or delegate your broker to trade on your behalf (known as a discretionary broking service).

Corporate bonds

What is it? A bond is a promise from a company that if you give them a sum of money now, they will give it back plus a set amount of interest after a set period of time. Many investment houses like M&G (mandg.co.uk) and Invesco Perpetual (invescoperpetual.co.uk) have corporate bond funds. Buy direct (find a list of available bonds at moneysupermarket.com/fixed-rate-bonds) or through brokers (see money.co.uk).

How much could you make? The average fund grew by 7.8% last year, meaning a £2,400 yearly investment would have made roughly £328.

What’s the risk? Bond funds are low risk because they invest in company debt, and debt holders are always the first to be paid if a company is in trouble.

Index tracker fund

What is it? An index-tracker buys shares in all the companies in an index, such as the FTSE 100 (100 biggest UK companies). This means you can have a stake in lots of companies, without having to buy each individual share yourself. You can buy via a stockbroker like Selftrade (selftrade.co.uk).

How much could you make? On average The RBS FTSE 100 tracker funds grow by 7% to 12% a year. So a yearly investment of £4,200 would have made between approximately £294 and £504.

What’s the risk? Lower than buying individual shares and recommended as the first major investment you make when buying into the stock market.