2 no-brainer UK shares I wish I’d known about when I started investing

2 no-brainer UK shares I wish I’d known about when I started investing


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I wish I knew what I know now when I began buying UK shares. There’s so much information available now that it can be overwhelming. So much so that many would-be investors give up before they even begin.

Worse still, many make bad decisions and end up losing money.

The truth is, there is no sure-fire way to invest without risk. But there are ways to reduce risk. I believe it’s best to take the safe and reliable route as a beginner. This typically means investing in well-established companies with a long history or stability.

It may not be exciting but it’s a good way to learn the ropes without losing balance!

Here are two shares I think would have made a beneficial addition to my portfolio when I was starting out.

National Grid

When starting out, early investors are often attracted to big gainers like Barclays or Rolls-Royce. They’ve both been making explosive gains this year and don’t get me wrong, I’m a fan of both myself. However, I consider a stock like National Grid (LSE: NG) more reliable due to its defensive nature and stable dividend track record.

Short-term gainers come and go but slow and steady growth is a rare find. Particularly when it comes coupled with the added bonus of a reliable 6.7% dividend yield. National Grid has one of the best dividend track records on the FTSE 100, increasing consistently for over 24 years. However, that doesn’t mean dividend payments are guaranteed.

But it’s not exciting. It’s up a comparatively mediocre 126% in the past 20 years, climbing slowly from £5 to around £12. Until recently, that is. In late May, it took a big hit after releasing subpar earnings results. On top of that, it holds a lot of debt and cash flow of late has been negative.

But it IS the key gas and electricity supplier to most of the country. Something tells me that demand for its services will remain high for the indefinite future. Me? I’m not the least bit worried about my shares.

Unilever

Notice a trend here? Very large, well-established British companies with a long history of successful operations. Yes, these are the kinds of stocks that are good for beginners because they’re unlikely to collapse tomorrow.

Unilever (LSE: ULVR) is a stalwart in the UK consumer goods market, selling everything from cleaning products to non-dairy ice cream. There are few high-street supermarkets that don’t stock a wide variety of Unilever products. 

But the recent market slump took its toll and profit margins are down to 10.9% from 13.6% last June. Unilever doesn’t market luxury brands but it does rely on customers willing to spend that little extra on quality. Lately, cash-strapped consumers faced with rising interest rates are turning to lower-cost alternatives, putting pressure on the company’s bottom line. 

A long-term concern? I doubt it.

Unlike National Grid, Unilever doesn’t focus on delivering value via dividends. Instead, its price performance speaks for itself — the shares are up 15% this year and 277% in the past 20 years. That equates to annualised returns of 6.9% per year. Not bad for a company with a £110bn market cap. 

So while global markets are unpredictable, I’m confident I can rely on my Unilever shares to deliver in the long run.



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